476 B.R. 114
D. Del.2012Background
- Grace filed Chapter 11 on April 2, 2001; Frenville governed when a claim arose under the Bankruptcy Code.
- Grace implemented the Bar Date Notice Program in 2002 to notify PD claimants and set a March 31, 2003 bar date.
- The Joint Plan was confirmed in January 2011 and appellate challenges followed, with Wright addressing Grossman’s interpretation in 2012.
- AMH filed a Rule 60(b) motion on May 29, 2012 seeking relief from the district court’s Memorandum Opinion.
- The district court denied relief, concluding Rule 60(b) is not the proper vehicle in appellate bankruptcy proceedings and finality interests prevail.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether AMH is entitled Rule 60(b) relief from the district court decision. | AMH argues Wright/Grossman’s expansion constitutes extraordinary relief. | Grace contends Rule 60(b) relief is improper in appellate bankruptcy and development in law is insufficient. | Denied; Rule 60(b) not appropriate here. |
| Whether Wright/Grossman’s developments justify relief under Rule 60(b)(5) or (6). | AMH asserts significant legal change renders prior ruling inequitable. | Grace argues no public-interest impact or extraordinary circumstance exists. | No relief; developments are not extraordinary circumstances. |
| Whether the district court properly declined to remand or grant relief while an appeal was pending. | AMH sought expedited relief before appellate review. | Court should refrain from disturbing final bankruptcy judgments pending appeal. | Denied; corollary remand procedure not satisfied. |
| Whether AMH has standing to advance due-process concerns of unknown post-petition claimants under Wright. | AMH seeks to protect rights of others potentially affected. | AMH lacks standing to assert others’ constitutional rights. | Denied; future claimants must be identified and pursue on appeal. |
Key Cases Cited
- Grossman’s v. Avellino & Bienes, 607 F.3d 114 (3d Cir. 2010) (expands 'claim' accrual to pre-petition exposure under Grossman’s)
- Wright v. Owens Corning, 679 F.3d 101 (3d Cir. 2012) (applies Grossman’s to post-petition/pre-confirmation exposure)
- Horne v. Flores, 557 U.S. 433 (U.S. 2009) (Rule 60(b)(5) focuses on public-interest changes; not here)
- In re Genesis Health Ventures, Inc., 280 B.R. 339 (D. Del. 2002) (finality of bankruptcy judgments favored; not warranted here)
- Venen v. Sweet, 758 F.2d 117 (3d Cir. 1985) (certifies rule that Rule 60(b) motion pending appeal may be limited)
- Martinez-McBean v. Gov’t of Virgin Islands, 562 F.2d 908 (3d Cir. 1977) (extraordinary-circumstances standard; strict construction)