Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

In this case, the parties disagreed about the nature of their dissolution agreement after one of them experienced a change in circumstances. Patriot Coal and Heritage Coal sought declaratory relief under 28 U.S.C. 2201 and Fed. R. Civ. P. 57, and requested a declaration that Peabody Holding's obligations with respect to the healthcare benefits owed to the Assumed Retirees would not be affected by modification of the benefits of retirees of Heritage or Eastern Associated under 11 U.S.C. 1114. The bankruptcy court denied relief and Patriot and Heritage appealed. While Heritage's rejection of its collective bargaining agreement relieved it of its contractual obligation to pay benefits, it still has a statutory obligation to pay those same benefits, at least until all of the steps of section 1114 are complied with. Therefore, the bankruptcy appellate panel (BAP) held that upon rejection of the "me too" agreement under section 1113, absent modification under section 1114, Heritage was still required to comply with the terms of the individual employer plan and provide its retirees those plan defined benefits; neither Heritage or United Mine Workers of America requested a modification; Peabody Holding's obligation under the liabilities assumption agreement remains undisturbed upon grant of the sections 1113 and 1114 motion; and Peabody Holding's remaining arguments lacked merit. Accordingly, the BAP reversed the decision of the bankruptcy court. View "Patriot Coal Corp., et al. v. Peabody Holding Co., et al." on Justia Law

Plaintiff appealed the bankruptcy court's finding that her student loan obligations to NCT and its loan servicer were nondischargeable. The bankruptcy appellate panel (BAP) concluded that the record revealed that plaintiff's past, present, and reasonably reliable future resources were not sufficient to meet all of the monthly payment obligations to NCT while maintaining a minimum standard of living. Accordingly, the BAP concluded on de novo review that excepting all of the obligations to NCT from discharge would be an undue hardship on plaintiff and, therefore, the BAP reversed and remanded for further proceedings. View "Conway v. National Collegiate Trust, et al." on Justia Law

Debtor appealed the bankruptcy court's order allowing a claim filed by the DHHS as a priority debt in the nature of a domestic support obligation. The court affirmed the judgment, concluding that the debt owed to DHHS was a debt in the nature of support of a child under 11 U.S.C. 101(14A)(B). The court concluded that debtor's remaining arguments lacked merit. View "Hernandez v. Dept. of Health & Human Serv." on Justia Law

These consolidated appeals concerned a home previously owned by debtor. On appeal, the Trustee challenged the bankruptcy court's order holding that he recover nothing from defendants on his action to avoid a transfer which occurred when defendants perfected their liens on estate property postpetition. GMAC challenged the part of the order holding that the automatic stay was not violated and that GMAC lacked standing in the matter. The bankruptcy appellate panel (BAP) concluded that GMAC did not have standing to appeal any violation of the stay because, if GMAC was aggrieved, it was either by a wrongful foreclosure by U.S. Bank or by its own failure to protect its interests, not by the registration of the judgments or the order. Therefore, the court dismissed GMAC's appeal. In regards to the Trustee's claim, the BAP affirmed the bankruptcy court's awarding of nothing to the Trustee where the estate's interest had no value in and of itself, and the loss of a right to use some sort of "leverage" to get money to which the estate was not entitled was not the basis for a cause of action. View "Seaver v. New Buffalo Auto Sales, LLC, et al." on Justia Law

Trustee filed an adversary complaint against Scarlett & Gucciardo to avoid as a preferential transfer under 11 U.S.C. 547, and recover under 11 U.S.C. 550, the $65,000 payment Scarlett & Gucciardo had received from Debtor. Scarlett & Gucciardo received the payment on behalf of defendant in connection with the settlement of a lawsuit. Trustee then filed a motion to amend the complaint to join defendant and to have the amended complaint "relate back" to the date of the original complaint. The bankruptcy appellate panel (BAP) concluded that the district court did not abuse its discretion in allowing Trustee to amend his complaint and to allow Trustee's amended complaint to relate back to the date of Trustee's original complaint; the $65,000 payment was not a contemporaneous exchange within the meaning of section 547(c)(1); and the payment was not made in the ordinary course of business within the meaning of section 547(c)(2)(A). Accordingly, the BAP affirmed the judgment. View "Ries v. Calandrillo" on Justia Law

Plaintiff appealed the bankruptcy court's imposition of sanctions on her for making factually unsupported and harassing statements in documents filed with the court. The court concluded that Federal Rule of Bankruptcy Procedure 9011 did not authorize the sanctions imposed in this case; even if Rule 9011 was inapplicable, it did not mean that the bankruptcy court lacked authority to sanction plaintiff; the court had jurisdiction over the appeal where the penalty imposed was criminal in nature because the monetary penalty was punitive, payable to the court, and non-compensatory; plaintiff did not move for recusal or object to the judge's participation and she therefore forfeited any objection; the bankruptcy court did not commit an obvious error by failing to recuse sua sponte and there was no showing of prejudice or miscarriage of justice; there was no reasonable probability of a different outcome before a different judge where the evidence of plaintiff's contempt was undisputed and aggravated; and plaintiff's remaining claims about the contempt process were without merit. Accordingly, the court affirmed the judgment. View "Isaacson v. Manty" on Justia Law

Debtor appealed a bankruptcy court order holding that the funds in his health savings account (HSA) were not excluded from the bankruptcy estate pursuant to 11 U.S.C. 541(b)(7)(A)(ii) and were not exempt. The bankruptcy appellate panel (BAP) held that an HSA was not a health insurance plan regulated by state law and, therefore, the HSA was not excluded from the bankruptcy estate by section 541(b)(7)(A)(ii). The BAP also concluded that section 522(d)(10)(C) and (11)(D) exemptions did not apply in this instance where the funds in the HSA could be used for purposes other than "disability, illness, or unemployment" and also could be used for purposes other than "personal bodily injury." Further, these exemptions applied only to a debtor's "right to receive" the stated benefits but, in this instance, debtor had already received the money from his employer and there was no longer a "right to receive" the funds that are already in the account. Accordingly, the BAP affirmed the judgment of the bankruptcy court. View "Leitch v. Christians" on Justia Law

Debtors filed a Chapter 13 bankruptcy petition and later, in an amended schedule, claimed as exempt an unliquidated personal injury claim. On appeal, debtors challenged the Bankruptcy Appellate Panel's (BAP) decision affirming the bankruptcy court's ruling that the holding in In re Benn compelled the conclusion that debtors' unliquidated personal injury claim could not be exempted from their bankruptcy schedules. The court concluded, however, that unless In re Benn was overruled en banc or by the Supreme Court, it remained binding precedent, and was directly applicable to the issues in this case. Accordingly, the court affirmed the judgment. View "Abdul-Rahim, et al. v. LaBarge, Jr." on Justia Law

Debtor filed for chapter 7 bankruptcy and then converted her case to one under chapter 13. J&M objected to debtor's homestead exemption in her chapter 7 case, but did not similarly object after she converted to chapter 13. The bankruptcy court entered an order confirming debtor's chapter 13 plan and debtor filed a motion to avoid J&M's judicial lien. The court affirmed, holding that debtor was entitled to claim her homestead exempt in her bankruptcy case; that J&M's judicial lien impaired her exemption; and that the bankruptcy court properly applied Kolich v. Antioch Laurel Veterinary Hospital in computing the extent to which the lien impaired debtor's exemption. View "J&M Securities, LLC v. Moore" on Justia Law

Debtor appealed the bankruptcy court's order denying her Motion to Set Aside Compromise. The bankruptcy appellate panel affirmed the judgment of the bankruptcy court, concluding that debtor failed to meet her burden to show a pecuniary interest to establish her standing to object to the trustee's Motion to Compromise or to pursue this appeal. View "Peoples v. Radloff" on Justia Law