In re Packard Square LLC, 579 B.R. 434

Debtor Packard Square, LLC filed a Chapter 11 that prompted competing motions, including Canyon’s § 305(a) motion seeking suspension of the bankruptcy and relief to allow a state-court receivership to proceed.
The Court treated Canyon’s § 305(a) request as raising the possibility of suspension or dismissal and elected dismissal as the clearer means to permit the receivership to proceed.
On October 13, 2017 the Court entered an order denying turnover, granting Canyon’s cross-motion, dismissing the chapter 11 case, and barring any new bankruptcy filing by or against the Debtor for two years.
The Debtor filed a motion for reconsideration (Oct. 30, 2017) challenging dismissal, notice, and the two-year refiling bar and presenting additional arguments/evidence.
The Court found the reconsideration motion defective: it raised previously decided issues, asserted new arguments/evidence waived on reconsideration, and failed to show a palpable defect or other grounds for relief.
The Court denied the motion, upheld dismissal and the two-year bar, and struck several filed “concurrences” as unauthorized responses to the reconsideration motion.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Dismissal Order should be reconsidered	Debtor: Court erred; did not have proper notice of possible dismissal; new evidence/arguments justify relief	Court/Canyon: Issues were raised earlier; no palpable defect; reconsideration improper for new arguments/evidence	Denied — motion fails to show palpable defect or proper basis for reconsideration under local rules and Civil Rule 59(e) standards
Whether new arguments/evidence may be raised on reconsideration	Debtor: New points/evidence cure deficiencies	Opponents: Reconsideration cannot be used to raise arguments/evidence that were available earlier	Denied — new arguments/evidence waived; reconsideration unavailable to re-argue or present newly available proof
Whether Debtor lacked notice that dismissal (vs. suspension) was possible	Debtor: Insufficient notice that Court might dismiss rather than suspend	Canyon/U.S. Trustee: § 305(a) motion inherently contemplated dismissal; parties argued dismissal at hearing	Denied — parties had ample notice via Canyon’s § 305(a) papers and courtroom argument from Canyon and the U.S. Trustee
Whether two-year bar on refiling was authorized	Debtor: Two-year bar improper/overbroad	Court: § 349(a) and § 105(a) authorize barring refiling to prevent abuse and evasion of rulings	Denied — two-year bar upheld as necessary to prevent abuse of the bankruptcy process

Roger Miller Music, Inc. v. Sony/ATV Publ’g, 477 F.3d 383 (6th Cir. 2007) (reconsideration cannot be used to raise new arguments)
Sommer v. Davis, 317 F.3d 686 (6th Cir. 2003) (new evidence not presented earlier generally cannot be introduced on reconsideration)
In re DSC, Ltd., 486 F.3d 940 (6th Cir. 2007) (objections raised first in reconsideration motions are waived)
Evanston Ins. Co. v. Cogswell Props., LLC, 683 F.3d 684 (6th Cir. 2012) (arguments raised first in reconsideration are untimely and forfeited on appeal)
Wiley v. United States, 20 F.3d 222 (6th Cir. 1994) (review of late-raised objections limited to avoiding gross miscarriage of justice)
Scottsdale Ins. Co. v. Flowers, 513 F.3d 546 (6th Cir. 2008) (exceptional cases may justify overlooking waiver rules)