Schwartz v. J.J.F. Management Services, Inc., No. 18-2160 (4th Cir. 2019)Annotate this Case
JJF appealed the district court's denial of its third party claim to funds in certain deposit accounts that plaintiff, owner of a Rent-a-Wreck (RAWA) franchise, sought to garnish in his effort to satisfy a contempt award against RAWA for engaging in a pattern of bad faith conduct. JJF argued that it had priority over plaintiff's claims to the accounts.
The court affirmed and held that the district court did not err in concluding that Maryland law permitted a trial court to require a third party movant to establish a bona fide claim of ownership. Therefore, the court declined to grant preclusive effect to the debtor-in-possession order and gave effect to the district court's authority to ensure compliance with its contempt orders.