Meridian Capital CIS Fund v. Burton (In re Buccaneer Res., L.L.C.), 912 F.3d 291

Curtis Burton was CEO of Buccaneer Resources until his May 2014 termination; he alleges the firing breached his contract and triggered a severance penalty.
Meridian Capital CIS Fund became Buccaneer’s principal secured creditor and allegedly pressured the board to fire Burton; Meridian later paid Buccaneer $10 million in a settlement incorporated into Buccaneer’s bankruptcy plan.
Burton filed and then withdrew a breach-of-contract claim in Buccaneer’s Chapter 11 case, then sued Meridian in state court for tortious interference (with related conspiracy/assisting claims).
Meridian removed Burton’s state suit to the bankruptcy court, arguing the claims belonged to Buccaneer’s bankruptcy estate and were released by the settlement.
The bankruptcy court remanded the tortious-interference claim to state court as Burton’s personal claim; the district court affirmed. The appeal concerns whether the claim is property of the estate or belongs to Burton.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Burton’s tortious-interference claim is property of the bankruptcy estate	Burton: his injury (wrongful termination/severance loss) is a direct, personal injury and thus his claim	Meridian: the harm is derivative—result of control over debtor and depletion of estate assets—so the estate owns the claim	Held: Burton’s claim is a direct injury to him, not derivative; it belongs to Burton, not the estate
Whether bankruptcy court has jurisdiction over Burton’s tort claim	Burton: no, because the claim is not estate property and he withdrew his bankruptcy claim	Meridian: yes, because the claim arises from prepetition conduct affecting the debtor and was effectively resolved in the bankruptcy settlement	Held: No bankruptcy jurisdiction; remand to state court affirmed
Whether the claim is merely lender-liability/derivative in disguise	Burton: form does not control; focus is on the nature of the injury he seeks to redress	Meridian: the substance shows lender-control caused the termination, making it derivative	Held: Labeling does not change ownership; the injury sought is independent and personal, so not derivative

In re Seven Seas Petroleum, Inc., 522 F.3d 575 (5th Cir.) (distinguishing direct creditor injuries from estate-derivative injuries)
In re Educators Grp. Health Trust, 25 F.3d 1281 (5th Cir.) (creditor’s direct reliance-based claim is not estate property)
In re Zale Corp., 62 F.3d 746 (5th Cir.) (claims not causing injury to the estate are not property of the estate)
Steinberg v. Buczynski, 40 F.3d 890 (7th Cir.) (trustee cannot sue third party for injury to a creditor, not the debtor)
In re Schimmelpenninck, 183 F.3d 347 (5th Cir.) (veil-piercing/alter-ego claims belong to the estate when they seek estate recovery)
In re Bernard L. Madoff Inv. Sec. LLC, 740 F.3d 81 (2d Cir.) (similar test: whether injury is inseparable from legal injury to the estate)