Judge Timothy A. Barnes - Opinions / Outlines

Judge Timothy A. Barnes

09 B 39937, 11 A 02200
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) allegations in complaint did not establish “good faith and for value” defense on face of complaint for purposes of 11 U.S.C. § 548(c); (ii) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted.

09 B 39937, 11 A 02224
Upon the Defendant’s motion to dismiss the Chapter 11 Plan Administrator’s adversary proceeding, seeking to avoid and recover as fraudulent transfers lease payments transferred from the Debtor to the Defendant that purportedly were part of fraudulent scheme, held: (i) that the Debtor may have received “reasonably equivalent value” was not fatal to cause of action to avoid lease payments as actually, and not just constructively, fraudulent transfers; (ii) the Plan Administrator did not have to identify a specific unsecured “triggering creditor” that was in existence at time of challenged transfers in order to state cause of action to avoid transfers as actually fraudulent to creditors under Illinois law, in exercise of 11 U.S.C. § 544(b) strong-arm powers due to scores of unsecured claimants; but (iii) the Plan Administrator failed to adequately allege Ponzi-type scheme and to explain how challenged payments were used to further alleged scheme and harm the Debtor’s other creditors.  Motion to dismiss granted in part and denied in part.

10 B 10717, 10 A 01418
Upon the Debtor’s motion for sanctions and attorney’s fees against the Plaintiff for continued prosecution of nondischargeability adversary despite failing to allege sufficient grounds in an amended complaint, held: although the Plaintiff violated Rule 9011 and did not act reasonably in commencing and continuing this adversary proceeding, the Debtor’s motion for sanctions failed to set forth the basis for her request for sanctions as it lacked the requisite legal arguments and citations to relevant facts to support the Debtor’s request for sanctions.  Motion for sanctions denied.

In re LaVergne Briggs
August 30, 2012

12 B 14853
Upon the Mortgagee’s motion for relief from stay and, in the alternative, to dismiss, held: (i) the standards have been met to grant relief from stay pursuant to 11 U.S.C. § 362(d)(1) since the Debtor has not provided any evidence as to adequate protection other than the Debtor’s plan payments to the Chapter 13 Trustee, including a series of late payments made on the date of the evidentiary hearing; (ii) the Debtor had filed a total of ten individual bankruptcy cases during a period of seven years, generally timed to precede a state court foreclosure action or the appointment of a receiver; and (iii) grounds exists for the court to enter an in rem relief order pursuant to 11 U.S.C. § 362(d)(4), as the Debtor’s petition for bankruptcy was found to be part of a scheme to delay or hinder the mortgagee’s collection efforts.  Motion for relief from stay with in rem relief granted.

Pages