Alderwoods Group, Inc. v. Reyvis Garcia
682 F.3d 958
| 11th Cir. | 2012Background
- Creditors sued in state court for tort claims against cemetery operators, alleging mismanagement of grave sites.
- Debtors filed for Chapter 11 in Delaware; bar date notice and Confirmation Order discharged pre-confirmation debts and retained jurisdiction.
- Creditors’ claims were argued to be discharged as of January 2, 2002 under 11 U.S.C. §§1141, 524; Florida court proceedings challenged notice adequacy under Mullane.
- Florida Bankruptcy Court denied summary judgment for discharge and declared Claims not discharged due to allegedly inadequate notice.
- Debtors sought declaratory relief and injunction in Florida Bankruptcy Court, which Creditors opposed; Florida court found discharge was not established.
- District Court affirmed Florida Bankruptcy Court’s decision, Debtors appealed to Eleventh Circuit seeking reversal and remand to Delaware Court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Florida Bankruptcy Court had subject-matter jurisdiction over the dispute. | Debtors: Florida court could adjudicate discharge/injunction issues. | Creditors: Florida court lacked exclusive jurisdiction over discharge issues; Delaware court retains control over estate. | Florida Bankruptcy Court lacked jurisdiction; proper forum was Delaware. |
| Appropriate disposition of the appeal given jurisdictional flaws. | Debtors urged remand to Delaware for merits; or transfer to Delaware District Court. | Creditors argued transfer not warranted; keep proceedings in Florida. | Vacate District Court judgment and transfer case to District of Delaware per §1412/§157. |
| Proper forum and mechanism to enforce discharge injunction. | Debtors sought declaratory relief and injunction to ensure discharge; ownership of enforcement lies with Delaware court. | Creditors maintain action in Florida; discharge injunction enforcement should be in Delaware. | Delaware Bankruptcy Court retains enforcement power; Florida court not proper forum. |
Key Cases Cited
- Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306 (U.S. 1950) (due process notice sufficiency for unknown creditors via publication)
- Travelers Indemnity Co. v. Bailey, 557 U.S. 137 (U.S. 2009) (bankruptcy discharge orders and enforcement in bankruptcy context)
- Local Loan Co. v. Hunt, 292 U.S. 234 (U.S. 1934) (bankruptcy court’s power to enforce its own orders)
- In re Hardy, 97 F.3d 1384 (11th Cir. 1996) (bankruptcy court contempt power under §105(a) to enforce discharge injunction)
- In re Chateaugay Corp., 201 B.R. 66 (S.D.N.Y. 1996) (retention of jurisdiction post-confirmation to complete actions pertinent to the plan)
- Waffenschmidt v. MacKay, 763 F.2d 711 (5th Cir. 1985) (injunction and its enforcement in bankruptcy context must be in issuing court)
- Odyssey Marine Exploration, Inc. v. Unidentified Shipwrecked Vessel, 657 F.3d 1159 (11th Cir. 2011) (in rem-like bankruptcy jurisdiction over res and rights against world)