Adversary No. 25-03024 (Southern District of Illinois)

Case No. 25-30549 (Southern District of Illinois)

Motion to dismiss for failure to state a claim granted in part and denied in part. Causes of action seeking to except debt from discharge under §§523(a)(2)(A) and (B), (4), and (6) based on allegations of conduct amounting to mere breach of contract, without more, were largely insufficient. The allegations of fraud lacked the requisite particularity and, in general, the complaint failed to put forth factual allegations to support the elements of the causes of action asserted.

11 U.S.C. §§523(a)(2)(A)-(B), (4), (6).

Fed. R. Civ. P. 9(b), 12(b)(6); Fed. R. Bankr. P. 7009, 7012.

Adversary Nos. 25-03000 (Southern District of Illinois) and 25-03008 (Southern District of Illinois)

Case No. 23-30045 (Southern District of Illinois)

Motions to dismiss complaint and compel arbitration denied where the causes of action asserted were derived from the Bankruptcy Code and could only be brought by trustee or debtor in possession on behalf of the Debtor's creditors. Because neither the creditors nor the trustee in whose shoes the Debtor was standing were parties to the Debtor's prepetition agreement to arbitrate disputes, they were not bound by the agreement and the Debtor therefore could not be compelled to arbitrate the claims asserted on their behalf.

Case No. 23-90402

Creditor filed motion to alter or amend order denying modification of protective order pursuant to Federal Rule of Civil Procedure 59(e). The motion to alter or amend was denied because it failed to identify manifest error and instead sought to relitigate old matters by rehashing arguments previously made and advancing new or modified legal theories and factual assertions that could and should have been made earlier. Further, although framed as seeking relief from one order, the motion was essentially a request for the Court to reconsider a different order entered two months earlier.

Fed. R. Civ. P. 59(e)

Fed. R. Bankr. P. 9023

Case No. 17-30503 (Southern District of Illinois)

Motion for relief from automatic stay filed by secured creditor denied as moot. The automatic stay was no longer in effect in individual Debtors' Chapter 11 case. Confirmed plan vested property of the estate in the Debtors and case was administratively closed years prior. To the extent the automatic stay had not terminated upon confirmation, it had terminated upon case closure. There was also no discharge or plan injunction requiring relief from the bankruptcy court. In the absence of a stay, the creditor was free to pursue remedies for the Debtors' default under the confirmed plan in any court of competent jurisdiction, making its motion for relief from stay unnecessary.

11 U.S.C. §§350, 362, 554, 1141

Fed. R. Bankr. P. 3022

Adv. No. 25-07011

Case No. 25-70566

Defendants' motions to dismiss granted. Complaint filed by the Chapter 11 Debtor was never properly served on Alabama Defendants and failed to state plausible claims for relief. Several of the asserted causes of action further sought relief not available from this Court or properly considered by the Alabama state court in which litigation involving the same parties as well as others was pending. In addition to dismissing the adversary proceeding in its entirety, the Court abstained from hearing matters related to the Alabama litigation. To effectuate abstention, the Court also entered an order in the Debtor's Chapter 11 case sua sponte granting relief from the automatic stay.

11 U.S.C. §§105(a), 362(d), (k), 542

28 U.S.C. §§1334(c), 2201

Fed. R. Bankr. P. 7004, 7012

Fed. R. Civ. P. 4, 12

Case No. 24-40450 (Southern District of Illinois)

Chapter 11 Debtor's objections to claims filed by one creditor on behalf of other creditors sustained. Creditor who filed the claims was neither an agent nor assignee of claims of the non-filing creditors. Although the filing creditor contended that it was authorized to file the claims based on security given for a common debt allegedly owed to it by the Debtor and non-filing creditors, the loan and security documents relied upon did not support but rather undercut the filing creditor's assertions. The claims were accordingly disallowed.

11 U.S.C. §501

Fed. R. Bankr. P. 3001, 3004, 3005

810 ILCS 5/9-102, 5/9-108, 5/9-109, 5/9-203, 5/9-204

Case No. 24-71004

Annulment of the automatic stay granted for cause based on the Debtor's failure to give timely notice of his bankruptcy filing to creditor so that foreclosure sale of his residence that occurred in violation of the automatic stay could have been prevented. Alternative request for dismissal of case for bad faith denied.

11 U.S.C. §§362(d)(1) and 1307(c) 

Case No. 23-70583

Debt arising from loan obtained using false written statements in loan application and supporting documents upon which creditor reasonably relied was excepted from the Chapter 7 debtor's discharge, but exception did not extend to debt arising from subsequent loan absent evidence that those same statements were used by the debtor to obtain and reasonably relied on by the creditor in making the second loan. The creditor failed to establish that either debt was incurred due to willful and malicious injury by the debtor as an alternate basis for excepting the debts from discharge.

11 U.S.C. §523(a)(2)(B), (6).

Case No. 23-90322

Prepetition transfer of a portion of Debtor's share of proceeds from sale of marital home to ex-spouse as reimbursement for downpayment on purchase avoided by Trustee as constructively fraudulent because it was made within two years of the bankruptcy filing, while the Debtor was insolvent, and for less than reasonably equivalent value.

11 U.S.C. §§548(a)(1)(B), 550

Adv. No. 23-03026 (Southern District of Illinois)

Case No. 23-30045 (Southern District of Illinois)

Adversary complaint filed by Chapter 11 Debtor against creditor and related entity dismissed in part with leave to replead. The Debtor asserted claims for breach of contract, promissory estoppel, avoidance of transfers as preferential and constructively fraudulent, and equitable subordination. Defendants moved to dismiss all counts for failure to state a claim upon which relief could be granted. Breach of contract count survived as to both defendants based in part on their admission of a valid contract in answer to previous iteration of complaint. Promissory estoppel count dismissed as to both defendants because the allegations relied on the existence of an express contract which would preclude relief under equitable principles. Preference avoidance count dismissed as to one defendant because the allegations did not support inference that the transfer was made to or for the benefit of or on account of a debt owed to that defendant. Count seeking to avoid transfer as constructively fraudulent dismissed as to both defendants because the Debtor received reasonably equivalent value for payment in the form of a dollar-for-dollar reduction of outstanding debt owed to the creditor defendant. And equitable subordination claim dismissed as to defendant that was not a creditor of the estate because it did not have a claim or interest to subordinate.

Fed. R. Civ. P. 12(b)(6); Fed. R. Bankr. P. 7012

11 U.S.C. §§510, 547, 548, 550

Case No. 22-70235

Chapter 7 Trustee's motion for turnover order and objection to the Debtor's amended claim of exemptions allowed in part. Debtor's amended schedules did not make evident what property was or was not being listed and claimed exempt given the information that was available to her and the traceability concerns stemming from her assets being converted to cash proceeds. As a result, the Debtor's amended claims of exemption were limited to the amounts scheduled.

11 U.S.C. §541(a)(1), (6)

Case No. 23-70610

Chapter 7 Trustee's objection sustained as to Debtors' claim of exemption in Illinois residence under Texas homestead exemption law. Although Texas law was applicable to Debtors under §522, the Texas homestead exemption statute limits its use to property located within the state and could not be used to exempt property in Illinois.

11 U.S.C. §522

Tex. Prop. Code. §41.002(d)

Case No. 21-70695

Prepetition transfer from the Debtor to significant other that rendered the Debtor insolvent and for which she did not receive a reasonably equivalent value was avoided as constructively fraudulent and recoverable by the Trustee.

11 U.S.C. §§548(a)(1)(B), 550

Case No. 22-70235

Chapter 7 Trustee's objection to the Debtor's claims of exemption in "Household Goods, "Electronics," and a handgun allowed in part. The Debtor's unitemized, categorical claims of exemption could not be traced to insurance proceeds from postpetition fire that resulted in loss of the Debtor's personal property. As a result, the Debtor's claims of exemption were limited to the scheduled amounts.

11 U.S.C. §541(a)(1), (6)

Case No. 21-70207

Trustee authorized to sell real estate co-owned by the bankruptcy estate and nonfiling spouse as tenants by the entirety for the benefit of the couple's joint creditors. The co-owners' interests in the property, which were contingent by virtue of a prepetition dissolution of marriage petition filed in Illinois state court, were determined and allocated among the co-owners in accordance with the Illinois Marriage and Dissolution of Marriage Act.

11 U.S.C. §363(h); 735 ILCS 5/12-112; 750 ILCS 5/503

Case Nos. 22-70120 and 22-70305

The United States Trustee's motions to dismiss granted in two cases filed by the same law firm on behalf of non-existent business entities. Because amending the petitions to correct the names (and in one case the Employer Identification Number) would not cure the problems of originally filing petitions for entities that do not exist and because entities that did not file the cases in the first place cannot rely on the rule allowing amendments to substitute themselves as the debtors, both cases were properly dismissed.

11 U.S.C. §§101(41), 109(a); Fed. R. Bankr. P. 1009(a) 

Case No. 18-71012

Debtor's voluntary motion to dismiss Chapter 7 case for cause denied notwithstanding his promise to pay creditors outside bankruptcy. The Debtor was previously denied a discharge in the long-pending case, and his history of abuse of the bankruptcy process precluded a finding that the best interest of his creditors would be served by dismissal. The Debtor also failed to establish authority for his request that the bankruptcy filing be expunged or sealed.

11 U.S.C. §707(a)

Case No. 20-71283

Fee applications of the Debtor's attorney and case trustee approved in Chapter 11 Subchapter V case in which consensual confirmation was achieved. The case, however, raised concerns about the developing standards for handling Subchapter V cases in the Central District of Illinois, warranting careful review and discussion of the work done and fees sought.

11 U.S.C. §§1181-1195

Case No. 18-71139

Debtor had standing to object to claims. Claims for debts of limited liability company of which individual debtor was member/manager were disallowed in debtor's individual bankruptcy case where claimants failed to meet their burden of proving that the debtor was personally liable to them for the debts.

§502(a); Fed. R. Bankr. P. 3001

805 ILCS 180/10-10

Case No. 19-70433

United States Trustee's Motion for a Determination of Reasonable Value of Services of Debtor's Attorney and for Sanctions granted. Disgorgement of fees and reimbursement of costs required where Debtor's attorney's conduct fell below professional standards and violated the Bankruptcy Code and Rules in the handling of the Debtor's Chapter 7 case.

§§105, 329, 526; Fed. R. Bankr. P. 1009, 7054, 9011

Case No. 20-90547

DIscharge denied where Debtor made false oaths in his bankruptcy petition and schedules by exaggerating his role and interest in various business entities.

11 U.S.C. §727(a)(4)(A)

Case No. 20-71187

Chapter 11 individual debtor could not claim Illinois tenancy by the entirety exemption in residential property that was not his homestead.

11 U.S.C. §522; 735 ILCS 5/12-1201; 735 ILCS 5/12-112; 765 ILCS 1005/1c

Case No. 19-70782

Actual and punitive damages, as well as attorney fees, awarded to Debtor as sanction against creditor for willful violations of the automatic stay.

Section 362

Case No. 19-71492

Motion to allow late-filed claim or to extend the time for filing denied where creditor had actual knowledge of Chapter 7 bankruptcy case despite not receiving proper, formal notice of the case.

Section 726(a)(2)(C); Federal Rule of Bankruptcy Procedure 3002(c)(6)(A)

Case Nos. 19-71144 and 19-71778

United States Trustee's Motions for Determination of Reasonable Value of Services of Debtors' Attorney and for Sanctions granted, in part. Disgorgement of fees and costs required where Debtors' attorney's conduct fell below professional standards and violated the Bankruptcy Code and Rules in the preparing, filing, and handling of the Debtors' bankruptcy cases.

Sections 105, 329, 526, 707(b)(4); Fed. R. Bankr. P. 9011

Case No. 18-71832

Debt excepted from discharge where Debtor signed security agreement misrepresenting his interest in and the encumbered status of collateral pledged.

Section 523(a)(2)(A) and (B)

Case No. 19-70537

United States Trustee's motion for disgorgement of fees granted. Fees and costs charged by Debtor's attorney to reopen case and file motion to avoid lien that should have been filed when the case was originally open but for the attorney's failure to perform reasonable investigation had to be disgorged.

Section 707(b)(4)(C), (D); Fed. R. Bankr. P. 9011

Case No. 19-90467

The Chapter 7 debtor's medical bills were consumer debts for purposes of determining whether "granting of relief would be an abuse of the provisions" of Chapter 7.

Sections 707(b)(1) and (b)(2)

Case No. 17-70853

Discharges of both Debtors denied where one Debtor made multiple false oaths at creditors meeting and subsequent 2004 examination and both Debtors willfully refused to comply with the Court's order requiring production of documents and participation in 2004 examinations.

Section 727(a)(4)(a) and (6)(A)

Case No. 19-70152

Judicial lien partially avoided to the extent that there was not enough equity in homestead to satisfy the lien after subtracting other liens and the Debtor's homestead exemption from the value of the property.

Section 522(f)(2)(A)

Case No. 17-90819

Lumping separate causes of action under the Illinois Uniform Fraudulent Transfer Act ("IUFTA") and the Federal Debt Collection Practices Act ("FDCPA") into a single count warranted dismissal with leave to file amended complaint.

Fed. R. Civ. P. 12(b)(6); Fed. R. Bankr. P. 7012

Case No. 17-90985

Debt owed to Plaintiff by limited liability company for breach of contract excepted from discharge of individual Debtor with company ownership or membership interest where the Debtor's false representations caused and resulted in the breach of contract and damages sustained by Plaintiff.

Section 523(a)(2)(A)

Case No. 18-70442

Chapter 7 Trustee's objection to the Debtors' claim of exemptions denied. Despite statutory presumption, the Trustee failed to meet his burden of proof in the face of the Debtors' credible and uncontradicted testimony to the contrary.

735 ILCS 5/12-1001

Case No. 16-91187

Debtors' discharges revoked where they were informed that tax refund was estate property in which the case trustee had an interest and ordered to turn over the refund but did not do so until after the action to revoke their discharges was commenced.

Section 727(d)(2).

Case no. 13-90942
Interim compensation for custodian and attorney of Chapter 11 corporate debtor allowed, in part, and denied, in part.
Section 330, Fed. R. Bankr. P. 2016.

Case No. 15-71018
Creditor's contingent claim against Debtors as gaurantors allowed in the amount of zero because claim was likely to remain contingent.
Section 502(b), (c) 

Case No. 17-71908
Chapter 13 trustee justified in not paying pre-confirmation adequate protection payments without the filing of a motion and the entry of an order specifically authorizing the payments to be made to a creditor.
Section 1326(a)(1)(C)

Case No. 12-72022 and 15-90801
Failure to fully disclose all compensation paid or promised to auctioneer warranted denial of applications for compensation of auctioneer.
Sections 327 and 330; Fed. R. Bankr. P. 2014, 2016, 6005

Case No. 17-70869
Joint stipulation regarding apparent agreement between Chapter 7 Debtor and her creditor to except a debt from discharge not approved where there was no pending adversary proceeding to properly bring the matter before the Court.
Sections 523(c) and 524; Rules 4007(c), 7001(6), and 7003

Case No. 17-90458
Trustee's objection to Debtor's claim of exemptions overruled and her motion for turnover order denied where proceeds from the sale of the Debtor's homestead were exempt under Illinois law on the petition date.
Section 522(b); 735 ILCS 5/12-906

Case No. 17-70023
Dismissal of Chapter 7 case warranted because the debtor did not rebut the presumption of abuse that arose from failing the means test.
Section 707(b)(1)-(2).

Case No. 16-71878
Debtor's motion to convert his Chapter 7 case to Chapter 13 denied where his conduct in filing his Chapter 7 case was not in good faith.
Sections 706(a) and (d), 1307(c).

Case No. 16-71699
Individual did not have sufficiently stable and regular income to enable him to make payments under any plan and therefore was not eligible to be a debtor under Chapter 13.
Sections 101(30), 109(e), 1307(c), 1325(a)(7)

Case No. 16-70536
Secured creditor could not be paid by the trustee through Chapter 12 plan without having a claim on file.
Fed. R. Bankr. P. 3002(c)

Adversary No. 15-09033
Blair M. Minton, Case No. 14-91293
Illinois LLC's operating agreement did not contain the types of material obligations that would make it an executory contract. The Court did not have subject matter jurisdiction over request for declaratory relief based on hypothetical facts.
11 U.S.C. 365; 28 U.S.C. 2201(a); 805 ILCS 180/1-1 to 60-1
 

Case No. 16-70699
Objection to discharge denied where omission of asset from schedules was inadvertent.
Section 727(a)(4)(A)

Case No. 15-71627
Application for compensation denied and attorney sanctioned for filing petition with debtors' electronic signatures affixed without first obtaining original "wet signatures."
Sections 105(a), 330(a)(3); Fed. R. Bankr. P. 1008, 9011.

Case No. 15-90708
Motion for leave to file late proof of claim denied.
Fed. R. Bankr. P. 3002(a), (c)

Adversary No. 14-7008
THR & Associates, Inc., Case No. 12-72022
Motions to dismiss adversary complaint denied - causes of action adequately stated and not time-barred.
Fed. R. Civ. P. 12(b)(6); Fed. R. Bankr. P. 7012

Adv. 15-9009
In re Blair M. Minton, Case No. 14-91293
Contractual provision which conditions repayment of loan upon default on other loans is not an unenforceable penalty.
Fed. R. Bankr. P. 7056

Case No. 13-72140
Chapter 7 Trustee's Final Report, which disclosed sale of asset at a loss and disclosed payment of estimated rather than actual expenses, reluctantly approved with adjustment to expenses and admonitions about future practices.
Sections 704(a), 330(a)(1)(B)

Adv. No. 14-07069
In re Butler, 14-71585
Section 523(a)(8)
Student debt not discharged where debtor failed to demonstrate "certainty of hopelessness."

Adv. No. 15-7023
Revocation of discharge denied where elements of proof - "knowing and fraudulent conduct" and "refusing" to comply - were unestablished.
Section 727(d)(1)-(3)
 

Case No. 15-71018
Mortgagee with valid, perfected security interest in post-petition rents entitled to stay relief and abandonment.
Sections 362(d)(1), 363(c)(2), 552(b)(2), 554(b)
 

Case No. 14-71331
Local Standards: Housing and Utilities allowance is available to anyone who has housing expenses.
11 U.S.C. 707(b)(2)(A); 11 U.S.C. 1325(b)

Adv. No. 14-07012
Objection to discharge sustained where debtor failed to disclose estate property and failed to comply with court order
Sections 727(a)(4)(A), (a)(6)(A)
 

Case No. 11-72074
Motion to Amend or Alter Judgment denied.
Section 102(1)

Case No. 14-70700
Section 1307(c)
Lack of good faith and unreasonable delay warranted case dismissal with one-year bar to refiling.

Case No. 14-71879
Section 541
Child support in hand generally belongs to parent, not child, and is property of Ch. 7 estate.

Bodily injury exemption may not be claimed by uninjured co-debtor spouse.
735 ILCS 5/12-1001(h)(4)

Case No. 14-71307
735 ILCS 5/12-1001(g); 735 ILCS 5/12-1006(a).
Trustee's objection to claims of exemption allowed in part; denied in part.

Case No. 13-70172
Section 330(a)(3)
Chapter 13 no-look fee denied. Fees reduced due to poor quality of work and failure to properly keep time.

Exemption for public assistance benefits does not extend to benefits received pre-petition.
735 ILCS 5/12-1001(g)

Case No. 10-72120
Motion to Modify Chapter 13 Plan granted in part.
Sections 1329, 1325(a)(6)
 

Case No. 13-71645
Section 330
Application for Attorney's Fees allowed in part; denied in part.

Sections 363(b), 503; Rule 2016
Fee application required regardless of basis for employment.

Section 547(b),(c); Fed.R.Bankr.P. 7056
Defense of ordinary course of business sustained to defeat preference action in part.

13-71005
 
Obligation to pay marital debt determined to be domestic support obligation and, therefore, stay relief granted.
 
Section 523(a)(5)

Stay relief, abandonment denied to contract for deed seller
Sections 362, 541, 554

Sec. 362
Annulment of stay denied.