Coy Cox, Jr. v. Specialty Vehicle Solutions
715 F. App'x 443
| 6th Cir. | 2017Background
- Cox, an IRS task-force officer, alleges toxic exposure from a battery in an SVS-modified van on Feb 28, 2014; he notified SVS and inspected the van in 2014.
- SVS filed Chapter 11 in Oct 2014 and did not list or notify Cox as a creditor.
- Cox filed a Kentucky suit on Feb 23, 2015 (after bankruptcy petition); SVS later notified the state court of the bankruptcy stay.
- Cox sought and submitted an agreed order in bankruptcy court to “resume” the Kentucky suit; the bankruptcy court entered the agreed order on Aug 7, 2015 (language vacating the stay to permit Cox to resume the action, limiting recovery to available insurance).
- Cox’s original case (Cox I) was removed and dismissed by the district court as void for having been filed in violation of the automatic stay; Cox filed a second suit (Cox II) on Sept 11, 2015.
- The district court dismissed Cox II as untimely under Kentucky’s one-year statute of limitations and because Cox filed it more than 30 days after notice of termination of the stay; the Sixth Circuit vacated dismissal of Cox I and remanded to evaluate whether the bankruptcy order retroactively validated Cox I, and affirmed dismissal of Cox II.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a suit filed in violation of the bankruptcy automatic stay can be validated here | Cox: the bankruptcy court’s Aug 7, 2015 agreed order annulled or retroactively validated his post-petition filing (or at least intended to) | SVS: Cox I was filed post-petition and the agreed order did not retroactively validate a suit filed in violation of the stay; Cox I is void | Vacated dismissal of Cox I and remanded so the district court can determine whether the bankruptcy order (an agreed order) was intended to operate retroactively (annul the stay) or only prospectively |
| Whether the equitable exception from Easley excuses the stay violation and saves Cox I | Cox: (did not principally rely on equitable exception on appeal) | SVS: equitable exception not satisfied | Court: equitable exception in Easley was not invoked by Cox and district court erred by treating it as the only means of validation; Easley provides two routes — bankruptcy annulment or limited equitable circumstances |
| When the 30-day grace period under 11 U.S.C. § 108(c)(2) begins to run for refiling a claim | Cox: the 30-day period began when SVS filed notice in state court (Aug 13, 2015) so Cox II (filed Sept 11) was timely | SVS: the period begins on actual notice of termination of the stay (Aug 7, 2015 when the bankruptcy court entered the order) | Affirmed dismissal of Cox II: 30-day clock began on Aug 7 when Cox received actual notice; Cox II filed after 35 days was untimely |
| Whether Cox is entitled to relief under Rule 59(e) / judicial estoppel bars SVS | Cox: raised retroactive validation and judicial estoppel; sought reconsideration | SVS: judicial estoppel not properly raised earlier | Court: district court did not abuse discretion rejecting Cox’s late judicial-estoppel argument and properly declined reconsideration on the other points without a full factual record |
Key Cases Cited
- Easley v. Pettibone Mich. Corp., 990 F.2d 905 (6th Cir. 1993) (stay-violation suits may be validated either by bankruptcy annulment or, in limited circumstances, by equitable exception)
- In re Glob. Technovations Inc., 694 F.3d 705 (6th Cir. 2012) (bankruptcy petition triggers automatic stay)
- Winget v. JP Morgan Chase Bank, N.A., 537 F.3d 565 (6th Cir. 2008) (interpretation of court orders is a question of law)
- Asher v. Unarco Material Handling, Inc., 596 F.3d 313 (6th Cir. 2010) (Kentucky statute of limitations for personal injury begins on date of injury)
- Simon v. Navon, 116 F.3d 1 (1st Cir. 1997) (§ 108(c)(2) grants 30 additional days after notice of termination of the stay to file claims)