Pinpoint IT Services, LLC v. Atlas IT Export, LLC (In re Atlas IT Export, LLC)
491 B.R. 192
1st Cir. BAP2013Background
- Atlas IT Export, LLC filed chapter 7; Atlas lists a contingent, unliquidated claim against Pinpoint (~$3.2M).
- Two parallel lawsuits: Virginia Action (Pinpoint plaintiff vs Atlas) and Puerto Rico Action (Atlas plaintiff vs Pinpoint).
- Bankruptcy petition stayed prosecution of Pinpoint’s claims; trustee sought modification to continue Puerto Rico Action; Pinpoint opposed.
- Stipulation for entry of order modifying the stay was consented to by the trustee and debtor; Pinpoint argued it was not a party and that the motion was a disguised stay relief request.
- Bankruptcy court granted modification to proceed with Puerto Rico Action and Pinpoint’s counterclaims; Pinpoint appealed, arguing lack of standing and prejudice.
- Panel ultimately dismissed the appeal for lack of standing, finding no legally cognizable detriment to Pinpoint.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Pinpoint has standing to appeal the stay-modification order | Pinpoint contends it is aggrieved by the order and thus has standing | Atlas and trustee argue Pinpoint has no cognizable harm and thus no standing | Pinpoint lacks standing; appeal dismissed |
Key Cases Cited
- In re Inofin Inc., 466 B.R. 170 (1st Cir. BAP 2012) (standards for appellate jurisdiction in bankruptcy)
- In re Bank of New England Corp., 218 B.R. 643 (1st Cir. BAP 1998) (jurisdiction and standing principles in bankruptcy appeals)
- Spenlinhauer v. O’Donnell, 261 F.3d 113 (1st Cir. 2001) (standing limitations in bankruptcy appeals)
- Aja v. Emigrant Funding Corp., 442 B.R. 857 (1st Cir. BAP 2011) (standing: aggrieved by order must be directly affected)
- Great Road Serv. Ctr., Inc. v. Golden (In re Great Road Serv. Ctr., Inc.), 304 B.R. 547 (1st Cir. BAP 2004) (standing and injury requirements in bankruptcy appeals)
- Travelers Ins. Co. v. H.K. Porter Co., Inc., 45 F.3d 737 (3d Cir.1995) (general principle that aggrievement requires direct, adverse pecuniary impact)
- In re El San Juan Hotel, 809 F.2d 151 (1st Cir. 1987) (limits on bankruptcy-order effects and standing)
- DiMaio Family Pizza & Luncheonette, Inc. v. The Charter Oak Fire Ins. Co., 448 F.3d 460 (1st Cir. 2006) (stability of litigation rights and non-deprivation for debtors)