490 B.R. 540
Bankr. E.D. Mich.2013Background
- Debtor moved for a stay pending appeal after the court converted the case from Chapter 11 to Chapter 7 on Nov 2, 2012; Debtor sought reconsideration of the conversion order, which was denied on Nov 16, 2013; Debtor filed a notice of appeal on Nov 30, 2013, possibly only appealing the Nov 16 denial rather than the Nov 2 conversion; Stay Motion filed Nov 30, 2013, with objections by the Chapter 7 Trustee and Becker-related creditors; Court denied stay without a hearing, concluding stay should be denied based on factors and standards for Rule 8005 stays; Rule 8005 incorporates Griepentrog four-factor framework for stays pending appeal; Debtor bears burden by a preponderance; the court’s analysis weighs against granting a stay; the bankruptcy estate includes assets beyond the Becker claim and prompt administration is favored by the Bankruptcy Code.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a stay pending appeal should be granted under Rule 8005. | Debtor seeks stay to protect appeal. | Trustee/Becker oppose stay; no irreparable harm; district court will likely affirm conversion. | Stay denied. |
| Likelihood of success on the merits on appeal. | Debtor will prevail on appeal. | District court will likely not reverse the conversion or denial of reconsideration. | Not shown. |
| Irreparable harm absent a stay. | Debtor will suffer irreparable harm to estate and claims. | Harm speculative; may be compensated; Trustee's settlements require court approval. | Not established. |
| Public and creditor harm from a stay. | Delay benefits creditors by preserving assets for appeal. | Stay would delay estate administration and harm creditors; public interest favors prompt administration. | Factors weigh against stay. |
Key Cases Cited
- Michigan Coalition of Radioactive Material Users, Inc. v. Griepentrog, 945 F.2d 150 (6th Cir.1991) (four-factor stay framework; emphasizes balance and irreparable harm considerations)
- Serv. Emps. Int’l Union Local 1 v. Husted, 698 F.3d 341 (6th Cir.2012) (reaffirmed standards for stays; need for showing, not mere likelihood of harm)
- Paschal v. Flagstar Bank, 295 F.3d 565 (6th Cir.2002) (abuse of discretion standards in reviewing stay decisions)
- In re M.J. Waterman & Assocs., Inc., 227 F.3d 604 (6th Cir.2000) (abuse-of-discretion standard; context of appellate review for stays)
- In re Forty-Eight Insulations, Inc., 115 F.3d 1294 (7th Cir.1997) (stay standards; caution against speculative irreparable harm)