In a noncore proceeding, the Court entered a proposed order for the District Court’s review finding that the Defendants violated the Fair Debt Collection Practices Act (“FDCPA”), breached a contract with the Plaintiff, and committed the torts of fraud and misrepresentation. Subsequently, the District Court entered an order adopting the proposed findings of fact and conclusions of law. Humes v. LVNV Funding, L.C.C. (In re Humes), 496 B.R. 557 (Bankr. E.D. Ark. 2013).
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Opinions
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Audrey R. Evans
Addendum to: Order Granting Motions to Appoint Trustee. This Addendum, to be read in conjunction with the Order Granting Motions to Appoint Trustee, contains facts and testimony regarding the various individuals and entities involved, the Debtor, the Debtor’s Chapter 11 filing, and the series of events that led to the Motions to Appoint a Trustee. Although the Court does not repeat its reasoning for finding that the appointment of a trustee was necessary and appropriate in this case, additional findings are made.
The Court denied the defendant’s request for a jury trial in the debtors’ § 362(k)(1) action for a willful violation of the automatic stay. The Court applied the Seventh Amendment right to trial by jury analysis set forth by the Supreme Court in Granfinanciera, S.A. v. Nordberg and concluded that the defendant was not constitutionally entitled to a jury trial because a § 362(k)(1) action asserts a “public right.” Calderon v. Bank of Am. Corp. (In re Calderon), 497 B.R. 558 (Bankr. E.D. Ark. 2013).
James G. Mixon
First Security's motion for relief from the stay was granted pursuant to section 362(b)(2) because the Debtor failed to show any reasonable possibility of a confirmable plan
The Plaintiffs' objection to the dischargeability of the debts pursuant to 11 USC 523(a)(2) was denied because they could not prove by a preponderance all of the necessary elements regarding each allegation. However, the Debtor's discharge was denied pursuant to 11 USC 727(a)(2)(A) because the Plaintiffs proved by a preponderance that the transfer of the Debtors ownership interest in his company was made with the fraudulent intent to defraud the Plaintiffs within one year of the petition date.
The Debtor was receiving social security disability benefits and had the duty to notify the SSA of any employment. The Debtor made a false representation with the knowledge of its falsity for the purpose of deceiving the SSA by not reporting his employment; the failure to report caused the overpayment which led to the Plaintiff's damage. Accordingly, the debt owed to the United States for overpayment of social security disability benefits in the sum of $49,517.70 was determined to be nondischargeable pursuant to 11 USC 523(a)(2)(A).
Judge Ben T. Barry
In this short order, the court distinguishes between criminal and civil contempt and finds that the state court order that sentenced the debtor to spend time in jail was criminal contempt because it carried an unconditional penalty and the jail time could not be purged.
The court found that, under Arkansas law, the debtor was not entitled to claim a homestead in property that was purchased with funds that were fraudulently transferred from a trust (of which the debtor was trustee) to the debtor's individual account. As a result, the debtor could not avoid a creditor's lien as impairing an exemption in the property.
The court found that the debtors’ joint case consisted of two separate debtors with two separate estates being jointly administered. As such, the debtors were only able to claim the exemptions to which they would be entitled individually. The court disagreed with the debtors’ argument that Arkansas marital dissolution laws establish the wife’s equitable interest in her husband’s property. However, the court did find that, under Arkansas law and the facts presented, the wife had an equitable interest in a vehicle that was titled solely in her husband’s name.
Judge Richard D. Taylor
Coercive application for contempt to collect a prepetition judgment constitutes a willful violation of the stay. Further, the debtor did not propose a plan consistent with the Code's treatment of domestic support obligations.