Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Raborn v. Schott

United States District Court, M.D. Louisiana

November 14, 2017

SUSAN RABORN,
v.
MARTIN SCHOTT, ET AL.

          RULING AND ORDER

          BRIAN A. JACKSON, CHIEF JUDGE

         Before the Court is an appeal of an order, issued by the United States Bankruptcy Court for the Middle District of Louisiana, approving a settlement in a Chapter 7 bankruptcy case. Appellant Susan Raborn filed an Emergency Motion for Stay Pending Appeal (Doc. 4) and an Amended Emergency Motion for Stay Pending Appeal (Doc. 16). Appellees James G. Muller, Betsy R. Muller; Karen R. Rogers, and Pedicons, Inc. filed a Motion to Dismiss the Appeal for Lack of Standing (Doc. 19), and a Motion to Strike Attachments Improperly Included in the Record on Appeal (Doc. 33). Appellees and Martin A. Schott, Trustee, filed a Motion to Dismiss Appeal for Mootness. (Doc. 44). The parties filed oppositions (Doc. 13, 24, 34), and Ms. Raborn filed a Brief. (Doc. 40). For the following reasons, the Emergency Motion for Stay Pending Appeal (Doc. 4) and the Amended Emergency Motion for Stay Pending Appeal (Doc. 16) are DENIED, the Motion to Dismiss the Appeal for Lack of Standing (Doc. 19), the Motion to Strike (Doc. 33), and the Motion to Dismiss Appeal for Mootness (Doc. 44) are GRANTED. The decision of the Bankruptcy Court is AFFIRMED.

         I. BACKGROUND

         Dr. Charles Raborn sold Ms. Susan Raborn 245 shares of stock in a family medical management company called Pedicons in 2006, but in 2013 when she failed to pay the purchase price he sued to dissolve the stock sale. In re Raborn, No. 15-10938, 2017 WL 1417204, at *2 (Bankr. M.D. La. Apr. 20, 2017). Dr. Raborn won a unanimous jury verdict in Louisiana state court, dissolving the stock sale and recognizing Dr. Raborn as the stock's owner. Id.

         On August 10, 2015, Ms. Raborn filed for Chapter 11 bankruptcy. In re Raborn, Doc. 1. The Bankruptcy Court then converted the Chapter 11 case to a Chapter 7 liquidation case on August 31, 2016. Id. at Doc. 609. Martin Schott was then appointed as the Trustee for Ms. Raborn's bankruptcy estate. Id. at Doc. 644. The Trustee then sued Dr. Raborn in the Bankruptcy Court to recover the stock lost in the state court judgment. In re Raborn, 2017 WL 1417204, at *2.

         On February 13, 2017, Martin Schott, the Trustee, filed a Motion to Approve a Settlement. In re Raborn, Doc. 705. The settlement will bring the estate $405, 000 and terminate pending litigation in federal and state courts. In re Raborn, 2017 WL 1417204, at *1. Ms. Raborn objected to the settlement. Id. On March 10, 2017, the Bankruptcy Court held an evidentiary hearing on the settlement. Id. at *5.

         On April 24, 2017, the Bankruptcy Court approved the settlement. In re Raborn, Doc. 761. On May 2, 2017, Ms. Raborn filed a Motion for Reconsideration of the Bankruptcy Court's Order that approved the settlement. In re Raborn, Doc. 763. On May 4, 2017, Ms. Raborn filed an Amended Motion for Reconsideration. Id. at Doc. 768. On May 5, 2017, Ms. Raborn timely filed a notice of appeal challenging the Bankruptcy Court's decision. (Doc. 1). On July 13, 2016, the Bankruptcy Court granted the Amended Motion for Reconsideration in part, and "reserve[d] the debtor's claim to an exemption under applicable law of Pedicons dividends, which the trustee shall retain pending further order of the court." Id. at Doc. 824.[1] On July 26, 2017, Ms. Raborn timely filed an Amended Notice of Appeal challenging the Bankruptcy Court's Order on her Amended Motion for Reconsideration. (Doc. 31-1).

         II. STANDARD OF REVIEW

          In bankruptcy appeals, district courts review bankruptcy court rulings and decisions under the same standards employed by federal courts of appeal. Carrieri v. Jobs.com Inc., 393 F.3d 508, 517 (5th Cir. 2004). A bankruptcy court's findings of fact are reviewed for clear error and its conclusions of law de novo. Carrieri v. Jobs.com Inc., 393 F.3d 508, 517 (5th Cir. 2004). Under the clearly erroneous standard, this court will reverse "only if, on the entire evidence, we are left with the definite and firm conviction that a mistake has been made." Walker v. Cadle Co., 51 F.3d 562, 565 (5th Cir. 1995). A bankruptcy court's dismissal for lack of standing is reviewed de novo. Joffroin v. Tufaro, 606 F.3d 235, 238 (5th Cir. 2010).

          III. DISCUSSION

         A. Motion to Strike Exhibits

         As a threshold matter, the Court must determine the universe of evidence that is part of the record on appeal. Appellees Betsy R. Rogers, Karen R. Rogers, and James G. Muller and Pedicons, Inc., request that the Court strike eight documents from the record, including seven affidavits and the articles of incorporation of Pedicons, Inc. (Doc. 33). Federal Rule of Bankruptcy Procedure 8006 "provides that the record on appeal from a bankruptcy court decision consists of designated materials that became part of the bankruptcy court's record in the first instance." In re SI Restructuring Inc., 480 Fed.Appx. 327, 328-29 (5th Cir. 2012) (quoting In re CPDC, Inc., 337 F.3d 436, 443 (5th Cir. 2003). "The rule does not permit items to be added to the record on appeal to the district court if they were not part of the record before the bankruptcy court." Id.

         Appellees argue that the seven affidavits and the articles of incorporation of Pedicons, Inc., that they seek to strike were not part of the Bankruptcy Court record. (Doc. 33-1). On April 13, 2017, the Bankruptcy Court ordered that Ms. Raborn's post-hearing brief be stricken from the record because she attached exhibits to it that she did not introduce into evidence at the March 10, 2017 evidentiary hearing. In re Raborn, Doc. 739. Appellees claim that many of the exhibits that the Bankruptcy Court ordered stricken are the same exhibits that Ms. Raborn now seeks to make part of the record on appeal. (Doc. 33-1). The Court, however, cannot view the documents that the Bankruptcy Court ordered stricken from the record because they were entirely removed from the electronic Bankruptcy Court docket. That said, the Bankruptcy Court made clear which exhibits it admitted in a minute entry following the March 10, 2017 hearing, and all of the exhibits that Appellees object to, were not listed in the Bankruptcy Court's order.[2] Therefore, the Court will not rely on any of these exhibits on appeal.

         B. ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.