Oetting v. Sosne, No. 18-1134 (8th Cir. 2018)
Annotate this CaseThe class representative of federal securities class actions appealed the dismissal of the unsecured creditor claim and amended claim he filed in the pending Chapter 7 bankruptcy proceeding of lead class counsel, Green Jacobson, P.C. The Eighth Circuit held that the claim for the cy pres distribution was no longer an issue because the distribution had been returned by the charity and deposited with the district court clerk for ultimate distribution for the benefit of the NationsBank class; the negligent supervision claim was time-barred; the disgorgement claim was not time-barred by Missouri's five year statute of limitations; and the bankruptcy court did not err in disallowing the bankruptcy claim as premature and lacking in supporting foundation. Accordingly, the court affirmed in part, reversed in part, and remanded.
Court Description: Loken, Author, with Benton and Shepherd, Circuit Judges] Civil case - Multi-district Litigation in In Re BankAmerica Corp. Sec. Litig. For related litigation, see Oetting v. Norton, 795 F.3d 886 (8th Cir. 2015). In appeal by a class representative regarding the dismissal of an unsecured creditor claim and amended claim he filed in the pending Chapter 7 bankruptcy proceedings of the lead class counsel, a claim for unreturned cy pres distribution was no longer in issue; a claim that the firm had negligently supervised the fund distribution was time-barred; the bankruptcy court erred in concluding that a claim for disgorgement was barred by Missouri's five-year statute of limitations; however, the bankruptcy court did not err in disallowing this claim because no disgorgement had been ordered in the MDL action and therefore the bankruptcy claim is premature and lacks supporting foundation; to assure a prompt resolution of the case and compliance with the court's mandate in In Re BankAmerica Corp. Sec. Litig. 775 F.3d 1060 (8th Cir. 2105), the bankruptcy court is directed to take certain actions; reversed and remanded to the district court with instructions to remand to the bankruptcy court for further proceedings.
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