Judge Timothy A. Barnes - Opinions

Judge Timothy A. Barnes

15 A 00819, 14 B 17886
Upon the chapter 7 trustee’s complaint under 11 U.S.C. § 363(h) seeking to sell all interests in real property held in a living trust in which the estate also has an interest, held: The trustee has established each element of section 363(h) to sell the real property free of the other interests therein. Therefore, judgment will be rendered in favor of the trustee and the trustee is authorized to sell the property.

17 B 05030
Upon the motion of a debtor statutorily without automatic stay protection to enforce the co-debtor stay, held: The debtor has standing to enforce the co-debtor stay regardless of whether or not she is protected by the automatic stay. As the postpetition judicial sale violated the co-debtor stay, the sale is void. The debtor has, however, failed to demonstrate an entitlement to damages. As a result, the debtor’s motion is GRANTED insofar as it seeks to have the sale and subsequent acts related thereto determined to be void but, in all other respects, is DENIED.

15 B 32968,16 A 00019

Upon the “no evidence” motion for summary judgment brought by Associated Bank, National Association, held: The movant has not established grounds for summary judgment under Federal Rule of Civil Procedure 56 as it has not established the absence of genuine issue of material fact in dispute.  There is a genuine issue of material fact concerning the debtors’ solvency on the date they closed a loan with the movant, and movant is therefore not entitled to judgment as a matter of law.  The motion is, therefore, DENIED.

14 B 14023, 16 A 00387
The matter before the court is whether, at the request of the debtor, the court should stay an adversary proceeding, brought by the United States Trustee, seeking a denial of discharge under 11 U.S.C. § 727. The debtor argues that the existence of parallel criminal investigations means that continuing the adversary is imprudent, as that might subject her to conflicting choices—namely to invoke a Fifth Amendment privilege against self-incrimination and face possible negative inferences arising therefrom, or to defend the adversary complaint and risk information therein being used in a criminal indictment. Held: In light of there being no actual pending criminal proceeding, the relevant standards as applied to the facts herein as they presently exist weigh in favor of continuing with the adversary. The motion to stay is, therefore, DENIED without prejudice.

08 B 10095
Upon the Motion for Entry of an Order (I) Enforcing Confirmation Order; (II) Directing Dismissal of State Court Claims; (III) Awarding Damages; and (IV) Granting Related Relief, brought by successor to the purchaser of assets in the above-captioned bankruptcy cases, held:  The movant has established that the claims brought in the state court actions are precluded by the confirmation order entered in this case.  The motion is, therefore, GRANTED as set forth in the attached Memorandum Decision.  A separate hearing on damages will follow.

15 B 32968
Upon the application from a class of former employees seeking allowance of an administrative expense claim for being terminated by the debtors in the above-captioned chapter 11 cases without notice as required by federal law and the liquidating trustee’s objection thereto, held: Despite the liquidating trustee’s claim that the debtors were liquidating and thus were excepted from the federal notice requirement, notice was required. As a result, the federal termination period applies and the damages relating thereto are postpetition damages. As a result, the application is GRANTED. The terminated employees’ administrative claim is allowed in an amount to be determined at a later hearing.

11 B 38875, 12 A 00155
Upon remand from the District Court for the Northern District of Illinois reinstating the plaintiff’s motion for summary judgment, held:  The plaintiff has established grounds for summary judgment under Federal Rule of Civil Procedure 56.  The debtor’s admissions establish that the debt she owed to the plaintiff arose when she, as trustee for an express trust, misappropriated funds from the trust to the detriment of the plaintiff, a beneficiary of the trust.  Such debt is nondischargeable under 11 U.S.C. § 523(a)(4).  The plaintiff’s motion for summary judgment is, therefore, GRANTED as to the statutory elements of 11 U.S.C. § 523(a)(4) and all alternative counts are mooted thereby.  The court abstains from hearing the only remaining aspect of the complaint—the value of the plaintiff’s claim.

12 B 49658
Upon the partial remand from the District Court for the Northern District of Illinois of the motion of the state taxing authority seeking monetary adequate protection following a sale of the debtors’ assets under 363(f), held:  The District Court directs this court to determine the issues of quantification and recovery of the state taxing authority’s adequate protection claim.  Because the state taxing authority has failed to demonstrate either a realizable claim or a source of recovery, the remaining aspects of the state taxing authority’s motion are DENIED.  In accord, all the remaining aspects of the secured lender’s competing motion are, therefore, GRANTED and the chapter 7 trustee is authorized to pay the remaining proceeds to the secured lender.

15 B 18583, 15 A 00826
Upon a creditor’s amended complaint seeking to deny discharge for the debtor on two counts under 11 U.S.C. § 727(a)(2)(A) and (a)(4)(A), wherein the creditor alleged that the debtor made prohibited prepetition transfers and failed to disclose certain assets on his bankruptcy petition, held: In regard to the 11 U.S.C. § 727(a)(2)(A) count, the creditor has not proven by a preponderance of the evidence that the debtor acted with actual intent to hinder, delay, or defraud creditors with respect to the alleged prepetition transfers. In regard to the 11 U.S.C § 727(a)(4)(A) count, the creditor has not proven by a preponderance of the evidence that the debtor acted with fraudulent intent when failing to disclose certain assets on his bankruptcy petition. As a result, the debtor will not be denied a discharge on the grounds alleged. Judgment is entered in favor of the debtor on all counts.

In re Ace Track Co., Ltd.
September 13, 2016

15 B 13819
Upon the Amended Motion for Order Granting Protection under 11 U.S.C. § 1522, brought by a creditor in the above-captioned chapter 15 case, held:  The motion raises serious concerns regarding the propriety of actions purportedly taken by the debtor in the chapter 15 case with respect to assets in the United States.  However, the motion is predicated on section 1522 of the Bankruptcy Code, which is inapplicable, and appears to seek no relief other than by declaration of the extent of the law.  As a result, insofar as the Memorandum Decision clarifies the extent of the law, the motion is GRANTED.  Otherwise, the motion is DENIED without prejudice.

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