Louie v. Volvo-California Swedish et al
Filing
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ORDER signed by Judge John A. Mendez on 11/15/11 ORDERING for the reasons set forth above, the Court GRANTS the Motion to Refer This Case to the United States Bankruptcy Court, Eastern District of California. (cc USBC)(Matson, R)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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GEORGE S. LOUIE,
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Plaintiff,
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v.
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VOLVO-CALIFORNIA SWEDISH et al., )
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Defendants.
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Case No. 2:11-CV-00074 JAM-KJN (
ORDER GRANTING TRUSTEE’S
MOTION TO REFER THIS CASE TO
THE UNITED STATES BANKRUPTCY
COURT, EASTERN DISTRICT OF
CALIFORNIA
This matter comes before the Court as a Motion to Refer this
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Case to the United States Bankruptcy Court, Eastern District of
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California (Doc. #44) presented by Alan S. Fukushima (“the Trustee”
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or “Mr. Fukushima”), Chapter 7 Trustee in the bankruptcy case In re
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Louie, United States Bankruptcy Court, Eastern District of
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California, Case No. 11-25036-C-7.
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Swedish (“Defendants”) oppose the motion (Doc. #46).1
Defendants Volvo-California
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This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was scheduled
for November 10, 2011.
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I.
FACTUAL AND PROCEDURAL BACKGROUND
On September 20, 2010, Plaintiff George S. Louie (“The Debtor”
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or “Mr. Louie”) filed the instant case.
He alleges that Defendants
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failed to accommodate his disability in violation of the Americans
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with Disabilities Act (“ADA”) of 1990, California Civil Code
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Sections 54 and 54.1, and the California Unruh Civil Rights Act.
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On February 28, 2011, Mr. Louie was placed into involuntary
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bankruptcy pursuant to Title 11 U.S.C. § 303: In re George S.
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Louie, United States Bankruptcy Court, Eastern District of
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California, Case No. 11-25036-C-7 (the “Involuntary Bankruptcy
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Case”).
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for relief.
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On March 30, 2011, the Bankruptcy Court entered an order
Mr. Fukushima was appointed as Chapter 7 Trustee.
On April 1, 2011, Mr. Louie filed a voluntary bankruptcy case:
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In re George Sing Louie, United States Bankruptcy Court, Eastern
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District of California, Case No. 2011-28344 (the “Voluntary
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Bankruptcy Case”).
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On May 31, 2011, the Bankruptcy Court consolidated the
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Involuntary Bankruptcy Case and the Voluntary Bankruptcy Case as
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Case No. 11-250360C-7 (the “Bankruptcy Case”) and appointed Mr.
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Fukushima as the Chapter 7 Trustee of the consolidated cases.
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Through the Trustee’s investigation, he discovered that the
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Debtor has more than 80 cases pending in various California state
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courts and federal district courts.
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allege that defendants failed to accommodate Mr. Louie’s disability
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in violation of the ADA.
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by the Trustee, this Court issued a related case order (Doc. #47)
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relating eleven other ADA cases pending before the district court,
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all before this Court.
Most or all of the cases
On September 22, 2011, upon application
The Trustee now moves to refer this case to
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the Bankruptcy Court (Doc. #44).
Defendants Volvo-California
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Swedish, et al. oppose the motion (Doc. #46).
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II.
A.
OPINION
Legal Standard
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Referral to Bankruptcy Court
28 U.S.C. § 1334(b) provides that federal courts shall have
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“original but not exclusive jurisdiction of all civil proceedings
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arising under title 11, or arising in or related to a case under
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title 11.”
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Supreme Court described the scope of “related to” jurisdiction
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under Section 1334(b):
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In Celotex Corp. v. Edwards, 514 U.S. 300 (1995), the
Proceedings “related to” the bankruptcy include
(1) causes of action owned by the debtor which become
property of the estate pursuant to 11 U.S.C. § 541,
and (2) suits between third parties which have an
effect on the bankruptcy estate.
Celotex Corp., 514 U.S. at 308 n. 5.
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Where the cause of action is not property of the estate in
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bankruptcy, courts in the Ninth Circuit utilize the Pacor test.
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The Pacor test considers “whether the outcome of that [civil]
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proceeding could conceivably have any effect on the estate being
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administered in bankruptcy.”
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994 (1984).
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courts consider “the efficient use of judicial resources, delay and
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costs to the parties, uniformity of bankruptcy administration, the
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prevention of forum shopping, and other related factors” when
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deciding whether to refer cases to the Bankruptcy Court.
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Farms v. International Brotherhood Of Teamsters, Chauffeurs,
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Warehousemen & Helpers, an Unincorporated Ass’n., 124 F.3d 999,
Pacor, Inc. v. Higgins, 743 F.2d 984,
Additionally, the Ninth Circuit suggests district
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Security
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1008 (9th Cir. 1997).
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B.
Claims for Relief
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The Trustee asks the Court to refer this case to the
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Bankruptcy Court because the instant case is property of the
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bankruptcy estate pursuant to 11 U.S.C. § 541(a)(1).
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case is also related to the bankruptcy case because the Trustee is
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already prosecuting thirty-two other ADA cases in the Bankruptcy
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Court filed by the Debtor.
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it would be an extreme burden for the Trustee to prosecute many
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The instant
Additionally, the estate has no cash so
cases in multiple courts.
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Defendants counter by arguing that as long as Defendants have
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a right to a jury trial and do not consent to the bankruptcy judge
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presiding over the jury trial, this case cannot be removed to
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bankruptcy court.
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§ 157(b)(5) to argue that the bankruptcy court does not have
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jurisdiction to determine Mr. Louie’s claims.
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argue that the Trustee did not cite legal authority requiring that
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this case be removed to bankruptcy court.
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Additionally, Defendants cite 28 U.S.C.
Defendants also
As discussed supra, this Court has jurisdiction over this
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action and the ability to refer it to Bankruptcy Court under 28
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U.S.C. § 1334(b).
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§ 541, the instant case is the legal interest of the debtor and is
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thus property of the estate.
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noncore ADA claims is irrelevant since the instant case is related
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to the Bankruptcy Case.
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judges to hear and determine such cases.
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does not require this Court to refer each related case to the
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Bankruptcy Court, the Court elects in this case to exercise its
The Court finds that pursuant to 11 U.S.C.
The fact that this case concerns
28 U.S.C. § 157(b) authorizes Bankruptcy
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While 28 U.S.C. § 157(a)
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discretion to refer it to the Bankruptcy Court.
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Contrary to Defendants’ concerns, referral to the Bankruptcy
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Court will not compromise their right to a jury trial.
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bankruptcy judge, with the consent of the parties, may conduct the
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jury trial.
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the bankruptcy judge conducting the jury trial, the bankruptcy
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court will handle the pretrial matters and this Court will preside
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over the jury trial.
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787-88 (9th Cir. 2007) (holding that in noncore matters (like the
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instant case), if a party timely demands a jury trial and there is
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no consent to the bankruptcy judge presiding over the trial, the
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bankruptcy court retains jurisdiction over pre-trial matters and
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the district court handles the jury trial).
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28 U.S.C. § 157(e).
The
If the parties do not consent to
See In re Healthcentral.com, 504 F.3d 775,
Referral to the Bankruptcy Court is an efficient use of
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judicial resources.
Bankruptcy courts routinely handle adversary
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proceedings and both the Bankruptcy Court judges and the District
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Court judges in this district are under heavy caseloads.
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to the Bankruptcy Court will result in an overall savings of
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judicial resources, as well as convenience for the parties because
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it will result in the same court handling the adversary proceedings
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and the overall administration of the underlying Bankruptcy Case.
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Additionally, since this case is about alleged violations of the
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ADA and does not involve bankruptcy law, uniformity of bankruptcy
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administration is not an applicable consideration.
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is no evidence of forum shopping as the impetus of this motion is
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to organize numerous cases in one forum.
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Referral
Finally, there
Accordingly, the Court
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GRANTS the Trustee’s Motion to Refer This Case to the United States
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Bankruptcy Court, Eastern District of California.
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III. ORDER
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For the reasons set forth above, the Court GRANTS the Motion
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to Refer This Case to the United States Bankruptcy Court, Eastern
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District of California.
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IT IS SO ORDERED.
Dated:
November 15, 2011
____________________________
JOHN A. MENDEZ,
UNITED STATES DISTRICT JUDGE
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