Scott v. 1105 Inglecress, LLC et al, No. 3:2019cv00072 - Document 4 (W.D. Va. 2019)
Court Description: MEMORANDUM OPINION. Signed by Senior Judge Glen E. Conrad on 11/26/19. (hnw)
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Scott v. 1105 Inglecress, LLC et al Doc. 4 CLERK' SOFFICEjJ.S. DINT. ATCHARLOU E COURT SVILE,VA FILED IN THE UNITED STATESDISTRICT COJJRT FOR THE W ESTEM DISTRICT OF VIRGINIA CH AR LOTTESV ILLE D IV ISION NCk 2s 2218 Juu cxou L ,,''B:j /u LE%( 1 . Inre: , t VICTOR M ACEO DANDD GE,111, Debtor. ' . W. T RUS STE TE PE HE FN ORSCOTT THEAN CHAP upj TE xw R7s ESTA TE OF V ICTOR M ACEO DA N DD G E,1111, M iscellaneou:Action No.3:19-m c-00006 A dversary Proceeding N o.6:19-ap- 06025 . M EM ORm UM OPIM ON By:H pn.G len E.Conrad . Plaintiff, SeniorUnited StatesDistrictJudge 1105 ING LECM SS,LLC and RICHARD L.SOOTH, D efendants. This adversary proceeding iscurrently pending in theUnited StatesBankruptcy Courtfor theW esternDistrictofVirginiaagainst1105Inglecress,LLC (GElnglecress'')andRicùardL:800th (collectively,theGr efendantsn). TheDefendantshàve sled amotion requesting thatthis court withdraw the reference of the proceeding to the banknptcy courtand preside over a11further m atters,including trial. PlaintiffW .Stephen Scotq Chapter7 TrustçefortheBankruptcy Estateof Victor Maqeo Dandridge (the R'l-rusteé''l has opposed the motion. The zourt conduc'ted a telephonichenring onthem otion onNovem bef20,2019. Forthereasonsstatedbelow,them otiort w illbe v anted. Case 3:19-mc-00006-GEC Document 7 Filed 11/26/19 Page 1 of 5 Pageid#: 159 Dockets.Justia.com Backeround OnM arch24,2017,VictorDapdridgefledavoluntarypev onforrelieftmderChapter7of theBnnknlptcyCode. Thisadverso proceedingadsesom theM ay 9,2016saleofDanM dge's m rsonalresidence located at1105 InglecressDrivein Charlottesvill#,Vlrginia (theç' Properx l. DandridgesoldthePropertyto lnglecxss,alimlted liability company formed byBooth. On M arch 22,2019,the Tmstee Sled = adverso complaintajaim tthe W fendants. seeldngtorecoverthePropertyorthevaluepaldforit Thecomplaintasserts;veclaim sunderthe Bnne lptcyCode. In Count1,theTrusteeclaim sthatthefmnAfrrshould beavoidedand sd aside * . , ' asasaudulentkansferpmsuantt osecuons48(a)(i)(A). h CiuntII,theTrusteeseekstoholdthe . Defendutsliablepurslmnttosedion 550. InCount111,theTmsteeseeks* preservethePropeo plmlmntto section 551. In CountlV,the Trusteeasserts aclaim fordisalloW= ce undersection 502(d). InCotmtV,theTrusteeseekstomcoverthePropertyundersection542. On April26,2019,theDefendants sled ajury demand. The pe ies have agreed that , Counts1,I1,111,M dIV mustbetriedby ajury,and thatnojua d al* 11beheldon CountV. AlthoughtheTrusteehasconsentedtoajurytrialinthebsnkrllptcyco< thebefendantshave declined to consent. Accordingly,on September10,2019,thebnnkntptcy courtentered an order couflrmlng thatit* 1notconductajury triàlon any ofthe clsim:aàserted in the adversary complaint SeeCaseNo.6:19-ap-06025,DZ.No.25 (Bnnkr.W .D.Và-Sept.10,2019)CBased e . thestatute,themles,andthelackofconsentoftheparties,thisCourtdeclinestoconductajurytrlal onany ofthecoun1.'');seealso'28U.S.C.9 157(e)Cl?therightto ajurytrialappliesin a proceedingthatmaybeheardunderthissectionbyabqnknxptcyJudge,tllebnnkrllptcyludgemay conducttllejurytrialifspecially desiN atedtobxercisesuchjurisdictionby thedistrictcourtand w1t11the expressconsentofa11theprkrtl 'es.''l;W .D.Va.Gen.R.3(b)Cln agcordancew1t11the T provisions of 28 U.S.C.j 157(e),brmknlptcy judges oftllis district m' e hereby speoiGcally Case 3:19-mc-00006-GEC Document 7 Filed 11/26/19 Page 2 of 5 Pageid#: 160 ' desirated to ciqductjury trials when allparties have expressly consentz theretoo'). rl'he ' a , t bnnkrllptcy courtO eqted the Defendo tsto 5le a mofon reqùesting thatthiscourtwithdraw the referenceoftheadverso proceezlngtbthebnnkmlptcycourt. On September 24,2019,the DefendantsO ely m oved to withdraw Ze reference. The motionhasbeen lxlly buefedand arguedand isnow ripefordisposiuon. D iseuggion Dise ctcourtshaveoriginaljurisdictionoverbnna zptcycasesO drelatedprocee 'ngs. 28 U.S.C.û 1334. TheW mtem DisdctofVirgM a has exerdsed its aulority under28 U.S.C. j 157(a)toreferallbnnknlptcy casesandproceedingstothebnna lptcyjudgesforthisdistrid. SteW .D.Vm Gen.R.3(a). However,thiscourtRmaywithdraw,inwholeorinpm anycaseor pror- zing xferredto underthissecdon,on itsown m otion oron timely modon ofany party,for nnllleshowm'' 28U.S.C.j157(d). Forthefollowingreasons,thecourt% dscausetowIIH W thereferenceofthisadversaryproceeding. In determlnlng whetherto with&aw the reference,courtsm ay consider severalfadors, ' * . includlnglithepreserkatlonofthedghttoajuryliat'' Fed.Ins.Co.v.Psa ell.407B.R.862,285 X .D.Va.20 .09)(citationomitted). Condqhaveheldth1 'twhereajuv 1a1isrequlredandthe pe esrefuseto consentto bnnknlptcyjurisdictiow withdrawalofthecasetothedisdctCOUI is appropriate.'' h reCinemakonics.hc..916F.2d1444,1451(RhCir.1990)(collece gcases);see . ' . alsoRileyv.W olkerine.M ctor& Schwartz.LLC,404 B.R.1,2 (D.Mass.2009)Ccauseto withdraw areferencepxistswhereapartyhasarlghttoatrialbyluryO ddoesnotconsenttohaving thatd alinthebnnEnlptcycourL''). n eSuprbmeCourthasheldlbnladefendnntinaaudulent-fmnsferacoonbroùghtbyihe trustœ ' isentitledtoajurytrialifthedefendnnthasnotfledaclnlm agm'nqtlebs mknlptcyednte. See O- nlnanciera.S.A.v.Nordbem ,492 U.S.33,36 (1989) C'W e hold thatthe Seventh Case 3:19-mc-00006-GEC Document 7 Filed 11/26/19 Page 3 of 5 Pageid#: 161 Amendmentenitles such a person to a Jug trial,notwithstanding Conpess'desir ation of fraudulentconveyanceacionsas'corepxceedings'in28U.S.C.û 157(b)(2)X ....'3. Inthis case,tllç Tn steeseekstoholdtheDefendu l liableforan allegedly gaudplentfm nqferkand itis ' . undisputedtbattheDefendantshavenotGled.aclnlm agnlnntthebnnknlptcyestate. Therefore,the DtftndantsareclearlyentitledtoajN trial. JZ BecausetheDefendantshavenotconsentedtoa juv trialinthebnnkrnptcyco< thebnnkrnptcycourtisnotauioria dtopresideoveraMaIby Juv. 28U.S.C.j157(e);W .D.VI Gen.R.3(19. ConsequentlyytheCOM Gndscausetowithdraw thereference ofthis'proceeding. In re' Clnemakonics.Inc..916 F.2d at14519seealso Butlerv. Batem. 601B.R.700,703-704(D.Massy2019)Cn isCourtrulesthatthi(defendants')Seventh AmendmentrighttoajurytrialconstitutescausetowithA wthereferencebecause(thedefendaàl) ' donètageetoajurytriàlintheBsnknxp3tcyCourt.'). I . Tlie courtalso fmds itappropdate to withdmw the reference lmmediately,ratherthsn w . * * . . : '* k .' . k . .@ * ,,' ' ' , , * - . ' waitinguntilalurytriallsNmmlnent. P1.sBr.Opp n 1!,Dld,No.3. TheunitedStatesCourtof Appeals forthe Fondh Circuithasrecognizyd thatthe'tim lng of the withdrawalis generally a 'tpram aic question ofeë cientcasendmlniskation,''ratherth= ç:a striçtly legalquesfon.'' lnre StaisburyPoplarPlace.Inc..13F.3d122,128(4thCir.1993)(ihternalquotationmarksandcitadon # , ' . oe tted), Underthecircumenncbspxsentedin thiscase,thecourtbelievesthatwithdrawingthe ieference >tthis stage of the pfoûeedings would avoid duplicative eFoxs,prbmotejudicial econom y,and aid in the eo cientand expediuousresolM on ofthe Tm stee's clnlm Aagm-nKtthe Defendgnl. Accordlngly,the courtwlll exercise its discretion to lmmediately withdmw the referenceofthisadverso proceeding. Conclusion Forthereasonsstated,thecourt* 11granttheDefendants'motiontowithdraw thereference, and ordeithatthereferenceofthisadversaryproceedingbewithdt'awn 9om thebnmternptcy court. 4 Case 3:19-mc-00006-GEC Document 7 Filed 11/26/19 Page 4 of 5 Pageid#: 162 M discugsed d'ldngthehendng,the courtwi1lisstlea schednllng orderthatincludesa M arch 31, 2020 deadllneforcompledng discovery,an April14,2020 dendllne fordisposiivemotions,and a subsequenttrialdate. TheClerk isdl- ted to send copiesofthismem orandum opinion O d the accomp= yingordertothebnne tptcy courtandallcounselofrecord. DATED:This % dayofNovember,2019. Senior nitedStatesDisd d Judge 5 Case 3:19-mc-00006-GEC Document 7 Filed 11/26/19 Page 5 of 5 Pageid#: 163
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