The court granted Defendants’ motion to dismiss finding that the complaint failed to plead fraud with sufficient particularity as required under Rule 9(b). Because the state court judgment lacked specific findings of fraud, issue preclusion did not apply. Although the deadline for filing dischargeability complaints had passed, an amendment was still permissible under Rule 15(c) as it related back to the original filing. Thus, the court granted dismissal without prejudice, allowing Plaintiff to amend the complaint to meet the heightened pleading standard.
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Honorable David L. Bissett
Miller v. Heaston (In re Heaston), Adv. No. 23-ap-11 (Bankr. N.D.W. Va. November 14, 2024)
Date: 11/14/2024
Date: 11/14/2024
The court grants Plaintiffs’ motion for summary judgment finding that the state court judgment against the Defendant is nondischargeable. The state court judgment, based on fraud and misrepresentation, was entitled to preclusive effect under the doctrine of collateral estoppel. The court held that these findings satisfied the elements for nondischargeability under § 523(a)(2) and declined to address the alternative grounds under § 523(a)(4) and § 523(a)(6). The defendant’s cross-motion for summary judgment was denied as moot.
Kulavik c. Heaston (in re Heaston), Adv. No. 23-ap-12 (Bankr. N.D.W. Va. Novermber 14, 2024)
Date: 11/14/2024
Date: 11/14/2024
The court grants Plaintiffs’ motion for summary judgment finding that the state court judgment against the Defendant is nondischargeable. The state court judgment, based on fraud and misrepresentation, was entitled to preclusive effect under the doctrine of collateral estoppel. The court held that these findings satisfied the elements for nondischargeability under § 523(a)(2) and declined to address the alternative grounds under § 523(a)(4) and § 523(a)(6). The defendant’s cross-motion for summary judgment was denied as moot.
Beaver v. Heaston (In re Heaston), Adv. No. 23-ap-10 (Bankr. N.D.W. Va. November 14, 2024)
Date: 11/14/2024
Date: 11/14/2024
The court grants Plaintiffs’ motion for summary judgment finding that the state court judgment against the Defendant is nondischargeable. The state court judgment, based on fraud and misrepresentation, was entitled to preclusive effect under the doctrine of collateral estoppel. The court held that these findings satisfied the elements for nondischargeability under § 523(a)(2) and declined to address the alternative grounds under § 523(a)(4) and § 523(a)(6). The defendant’s cross-motion for summary judgment was denied as moot.
Johnson v. Struebing (In re Russell), Adv. No. 24-ap-10 (Bankr. N.D.W. Va. July 19, 2024)
Date: 07/19/2024
Date: 07/19/2024
The court grants Defendants’ motions to dismiss on Plaintiff’s complaint attempting to avoid a post-petition foreclosure sale of property of the estate. The court determined that § 362(c)(4) satisfied the “authorization” component necessary to defeat the Plaintiff’s complaint seeking relief under § 549(a) of the Bankruptcy Code. Additionally, the court held that although the bankruptcy estate retained an interest in the property, the estate’s interest was in any excess proceeds resulting from a valid foreclosure sale.
In re Patrick Dewire Hottinger, ( 2:21-bk-00669)
Date: 07/20/2023
Date: 07/20/2023
Following a motion for reconsideration on an order granting a fee application with a reduction for unproductive travel time, the court evaluated its decision on the appropriate billable rate for travel time. Consistent with its original ruling, the court concludes that it maintains discretion to review an employment agreement and make adjustments accordingly. The court upholds its determination that unproductive travel time is compensable at one-half a professional’s normal hourly rate.
In re Patrick Dewire Hottinger, Bankruptcy Case No. 2:21-bk-00669 (Judge Bissett)
Date: 05/03/2023
Date: 05/03/2023
In the context of a professional’s application for compensation, the court addressed the appropriate billable rate for travel time. The court concludes that time traveling, and not performing legal services while traveling, is compensable at one-half a professional’s normal hourly rate.
Paugh v. Graham (In re Paugh), Adversary No.: 1:22-ap-00006 (Judge Bissett)
Date: 04/19/2023
Date: 04/19/2023
Consistent with the court’s previous determination that the Defendant willfully violated the stay, damages were assessed under 11 U.S.C. Sec. 362(k)(1). The court awarded the amount of the garnished wages and related attorney fees. Ultimately, the court imposes damages upon the Defendant in the amount of $13,025.72.
Graham v. Paugh, Jr. (In re Paugh, Jr.), Adv. Proc. No. 22-ap-00008 (Bankr. N.D.W.Va. Feb, 6, 2023)
Date: 02/06/2023
Date: 02/06/2023
The court determines that the Plaintiff’s state court judgment against the Defendant is non-dischargeable: the Plaintiff meets her burden of proof under 11 U.S.C. § 523(a)(2)(A). The Defendant misrepresented himself as a licensed Contractor.
Paugh, Jr. v. Graham (In re Paugh, Jr.), Adv. Proc. No. 22-ap-0006 (Bankr. N.D.W. Va. Feb 6, 2023)
Date: 02/06/2023
Date: 02/06/2023
The court grants, in part, the Plaintiff’s motion for summary judgment on his complaint for willful violation of the stay under 11 U.S.C. § 362(k). In that regard, there is no material dispute as to the Defendant’s liability based upon her actions regarding her garnishment of the Chapter 7 Plaintiff-Debtor’s post-petition wages. The court set a subsequent hearing to determine damages.
WVNB New Memorandum Opinion: McAuliffe v. IRS (In re McAuliffe), Adv. Proc. No. 20-44 (Bankr. N.DW. Va. May 26, 2022)
Date: 05/26/2022
Date: 05/26/2022
The Court found the IRS in contempt of the Debtor’s discharge order and awarded $498.21 in damages. Attorney’s fees were denied on the basis that the attorney was representing his spouse without a fee agreement and there were no out of pocket legal expenses that could be recovered under 26 U.S.C. § 7430.
A.M. v. Randlett (In re Randlett), Adv. Proc. No. 21-ap-25 (Bankr. N.D.W. Va. Feb. 25, 2022)
Date: 02/25/2022
Date: 02/25/2022
The Court denied entry of summary judgment in a 11 U.S.C. § 523(a)(6) exception to discharge case that was filed after entry of a state court civil default judgment awarding damages against the debtor for sexual crimes that were committed by non-debtors who were present at the debtor’s home.
Honorable Becker McKay Wyckoff Mignault
In re ThreeSquare, LLC, Case No. 3:19-bk-00975 (Judge Mignault)
Date: 03/28/2023
Date: 03/28/2023
In overruling the objection of the United States Trustee and denying its motion to convert, the court found the Debtor’s proposed Chapter 11 plan of reorganization to be feasible based upon the financial projections and the commitment of the Debtor’s principals. Additionally, the court was unpersuaded by the United States Trustee’s assertion that the exculpation clause in the Debtor’s plan violated the Fourth Circuit’s instruction in Berhmann v. Nat’l Heritage Found., 663 F.3d 704 (4th Cir. 2011).
Johns v. Mannington Home Center, Inc. (In re Armstead), 1:22-ap-00004 (Bankr. N.D.W. Va. August 22, 2022) (Judge Mignault)
Date: 08/22/2022
Date: 08/22/2022
In denying Mannington’s motion to dismiss and granting the Chapter 7 trustee’s motion for summary judgment, the court found that the viability of Mannington’s judgment lien was not extended beyond the initial 10-year period such that the Chapter 7 trustee can avoid the purported lien. In that regard, the court was unpersuaded by Mannington’s argument that the debtor’s several bankruptcy cases extended the effective period of its lien by more than 1,300 days. Notably, no automatic stay existed in December 2018 when Mannington’s lien was set to expire.
Fitzgerald v. Tucker (In re Tucker), 19-ap-12 (Bankr. N.D.W. Va. June 9, 2022)
Date: 06/09/2022
Date: 06/09/2022
The court grants a creditor summary judgment and denies the Chapter 7 debtor’s anticipated discharge under § 727(a)(5) of the Bankruptcy Code. Specifically, the could found as unsatisfactory the debtor’s uncorroborated explanation of his expenditure of over $1,000,000 in the few years before seeking Chapter 7 relief.
The Truth Tellers, LLC v. Levine (In re Levine), Adv. Proc. No. 20-ap-36 (Bankr. N.D. W. Va. March 31, 2022)
Date: 03/31/2022
Date: 03/31/2022
The Court denied an exception to discharge complaint under 11 U.S.C. § 523(a)(4) that alleged defalcation or fraud with acting in a fiduciary capacity or, in the alternative, embezzlement.
Sheehan v. Levine (In re Geostellar, Inc.), Adv. Proc no. 19-ap-24 (Bankr. N.D.W. Va. March 21, 2022).pdf
Date: 03/21/2022
Date: 03/21/2022
The trustee alleged that the defendant, a member of the debtor’s board of directors, created a direct competitor to the debtor and took other actions for his personal gain to the detriment of the debtor. The defendant asserted that an arbitration clause in his employment contract should be enforced to adjudicate the trustee’s claims. The Court, however, found that the causes of action for breach of fiduciary duty, negligence, constructive fraud and/or negligent misrepresentation of facts, and a violation of the Uniform Trade Secrets Act, were not subject to the employment agreement’s arbitration clause. Additionally, the Court determined that the trustee’s causes of action survived challenges based on the “gist of the action” and the “economic loss” doctrine.
Honorable Paul M. Black
Comm 2013 CCRE12 Crossings Mall Road, LLC v. Tara Retail Group, LLC (In re Tara Retail Group, LLC), Adv. Proc No. 21-1 (Bankr. N.D.W. Va. April 20, 2022)
Date: 04/20/2022
Date: 04/20/2022
The Court denied a motion to stay pending appeal regarding the Court’s Order on Summary Judgment and Order on Confirmation. The Court denied the stay, among other reasons, because the Appellants failed to show that they were likely to succeed on the merits of the appeal.
Comm 2013 CCRE Crossings Mall Road, LLC v. Tara Retail Group, LLC (In re Tara Retail Group, LLC), Adv. Proc. No. 21-ap-1 (Bankr. N.D.W. Va. Jan. 6, 2022) (Judge Black)
Date: 01/06/2022
Date: 01/06/2022
On summary judgment, the Court addressed a dispute over the meaning of certain language in the debtor’s confirmed Chapter 11 plan, and addressed other related issues.
U.S. Bank Nat'l Ass'n v. Tara Retail Group, Inc. (In re Tara Retail Group, Inc.), Adv. Proc. No. 18-10 (Bankr. N.D.W. Va. Dec. 27, 2021) (Judge Black)
Date: 12/27/2021
Date: 12/27/2021
In adjudicating a contractual fee shifting agreement in a contract, the court found that two parties (Wells Fargo and U.S. Bank) failed to file a proof of claim were therefore prohibited from asserting claims against the estate. A third party (Comm 2013), however, had filed a timely proof of claim and was entitled to recover its attorney’s fees from the estate. Whether Wells Fargo or U.S. Bank could recover attorney’s fees under a pooling and services agreement was not adjudicated by the court as that agreement was not before it. In reviewing whether a reduction to Comm 2013 $549,988.23 attorney fee and expense request was warranted, the court determined that the attorneys’ hourly compensation rates between $375 and $775 were reasonable under the circumstances, but in reviewing paralegal rates between $200 and $440 per hour, the court capped the requested hourly compensation at $250 per hour. Among other things, the court countered “block billing” practices by reducing the requested fees by 10% for each block billing entry over 0.5 hours and determined that pro hac vice fees were personal to the attorney and not compensable from the estate.