How Does Bankruptcy Affect State Court Litigation?

Useful Rulings on Bankruptcy’s Effect on State Law

Rulings on Bankruptcy’s Effect on State Law

1-25 of 185 results

BRYAN JAMES VS. BRYAN CRAIG

The state court should have given effect to the bankruptcy court's orders. By going further, the state court exceeded its jurisdiction, even if the state court believed that Rutz had valid grounds to object to the orders.

  • Hearing

    Feb 16, 2018

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

  • County

    Los Angeles County, CA

SOULLIERE VS. SUZUKI MOTOR AMERICA, INC.

In this case, the bankruptcy court did apparently make express findings which were not made in Savage. So Savage does not stand for the proposition that a state court may ignore a federal bankruptcy court’s express findings. Once again, Plaintiff’s remedy, if he seeks to challenge the bankruptcy court’s findings, would be in federal court, not state court.

  • Hearing

    Jun 27, 2018

THE PEOPLE OF THE STATE OF CALIFORNIA VS. NOEL THOMPSON

Subsequently, the bankruptcy court converted the proceeding to one under chapter 11. Gruntz moved to dismiss the criminal prosecution on the ground that the state court proceedings were in violation of the bankruptcy court's automatic stay. The state trial court denied the motion, and the matter proceeded to trial. Gruntz was convicted. On appeal in the state court, Gruntz argued that the criminal case was subject to the automatic stay.

  • Hearing

    Dec 30, 2013

  • Type

    Insurance

  • Sub Type

    Intellectual Property

SOULLIERE VS. SUZUKI MOTOR AMERICA, INC.

In this case, the bankruptcy court did apparently make express findings which were not made in Savage. So Savage does not stand for the proposition that a state court may ignore a federal bankruptcy court’s express findings. Once again, Plaintiff’s remedy, if he seeks to challenge the bankruptcy court’s findings, would be in federal court, not state court.

  • Hearing

    Jun 27, 2018

SOULLIERE VS. SUZUKI MOTOR AMERICA, INC.

In this case, the bankruptcy court did apparently make express findings which were not made in Savage. So Savage does not stand for the proposition that a state court may ignore a federal bankruptcy court’s express findings. Once again, Plaintiff’s remedy, if he seeks to challenge the bankruptcy court’s findings, would be in federal court, not state court.

  • Hearing

    Jun 27, 2018

IN RE THE RACHEAL MOFYA DISTRIBUTION TRUST DATED OCTOBER 28, 2011

At issue here is the effect of the settlement, approved by the Bankruptcy Court, between Petitioners and the BR trustee on the Petitioners bankruptcy claim (based on the Order for Writ of Attachment) against Respondent McQueen in the pending state court action, the Ventura Action The Court concludes there is no res judicata effect precluding Respondent's pending motion for summary judgment. 1.

  • Hearing

    Aug 30, 2017

  • Type

    Probate

  • Sub Type

    Trust

IN RE THE RACHEAL MOFYA DISTRIBUTION TRUST DATED OCTOBER 28, 2011

At issue here is the effect of the settlement, approved by the Bankruptcy Court, between Petitioners and the BR trustee on the Petitioners bankruptcy claim (based on the Order for Writ of Attachment) against Respondent McQueen in the pending state court action, the Ventura Action The Court concludes there is no res judicata effect precluding Respondent's pending motion for summary judgment. 1.

  • Hearing

    Aug 30, 2017

  • Type

    Probate

  • Sub Type

    Trust

IN RE THE RACHEAL MOFYA DISTRIBUTION TRUST DATED OCTOBER 28, 2011

At issue here is the effect of the settlement, approved by the Bankruptcy Court, between Petitioners and the BR trustee on the Petitioners bankruptcy claim (based on the Order for Writ of Attachment) against Respondent McQueen in the pending state court action, the Ventura Action The Court concludes there is no res judicata effect precluding Respondent's pending motion for summary judgment. 1.

  • Hearing

    Aug 30, 2017

  • Type

    Probate

  • Sub Type

    Trust

JOSE L RAMIREZ VS JP MORGAN CHASE BANK ET AL

Discussion Defendants contend that this Court has the authority to decide the motion for judgment on the pleadings despite the pending bankruptcy on two grounds: 1) this Court has concurrent jurisdiction with the Bankruptcy Court over Ramirez’s claims, and 2) the automatic stay does not preclude a defensive action commenced by a debtor in state court. The Court finds Defendants’ argument well-taken.

  • Hearing

    May 22, 2018

  • Type

    Real Property

  • Sub Type

    Foreclosure

JOSE J. MEJIA VS. ROUSSOS CONSTRUCTION INC.

Whether the Bankruptcy Court should grant injunctive relief under its equitable powers under 11 U.S.C. §105. 3. Plaintiffs' request for relief from the automatic stay so that their claims, including the PAGA claims against Nino, should be litigated in state court or before the Bankruptcy Court. 4. Whether the bankruptcy trustee will allow Nino's claims pursuant to his cross-complaint to be litigated in state court or before the Bankruptcy Court.

  • Hearing

    Feb 22, 2018

  • Type

    Employment

  • Sub Type

    Other Employment

JOSE J. MEJIA VS. ROUSSOS CONSTRUCTION INC.

Whether the Bankruptcy Court should grant injunctive relief under its equitable powers under 11 U.S.C. §105. 3. Plaintiffs' request for relief from the automatic stay so that their claims, including the PAGA claims against Nino, should be litigated in state court or before the Bankruptcy Court. 4. Whether the bankruptcy trustee will allow Nino's claims pursuant to his cross-complaint to be litigated in state court or before the Bankruptcy Court.

  • Hearing

    Feb 22, 2018

  • Type

    Employment

  • Sub Type

    Other Employment

PADILLA V. WECOSIGN, INC.

As such, Carlos Padilla III can prosecute the underlying State Court Action in its entirety, provided all claims are related to non-dischargeable subject matter. Upon entry of judgment by the Orange County Superior Court, Carlos Padilla III shall seek (if appropriate) nondischargeability of the state court judgment before this Court.”

  • Hearing

    Nov 01, 2018

STEPHENSON VS. ERTL, ET AL.

On May 21, 2018, the parties were ordered to file Status Reports advising the Court as to the status of the bankruptcy stay. No Status Reports have been received. The Court notes that Plaintiff has filed a document entitled Notice to State Court of Removal of Action by Defendants, informing the Court that on June 26, 2018, Plaintiff filed a Notice of Removal of this action to the United States Bankruptcy Court.

  • Hearing

    Nov 19, 2018

IRIS MANUEL VS. VARDOUI MADATIAN, ET AL

The Bankruptcy Court stated: “So it appears to me that the state court is trying to respect the automatic stay and the court’s jurisdiction. I appreciate that very much and believe, you know, we try to—the two courts try to get along and I do appreciate it. But by granting this motion for relief from the automatic stay I am saying to the state court judge, the state court whichever judge is presiding, you may do whatever you think you should do or not do with respect to the judgment.” [Ex.

  • Hearing

    Jan 25, 2019

SHANGHAI OVERSEAS AFFAIRS SERVICE VS OASIS GROWTH PARTNERS

If the bankruptcy court later decides that the state court was incorrect, the state court proceedings in violation of the stay are void. See, e.g., In re Schwartz, 954 F.2d 569 (9th Cir.1992); In re Shamblin, 890 F.2d 123 (9th Cir.1989). On the other hand, if the state court is correct in deciding that the stay does not apply, the state court proceedings are not void. Gruntz, 202 F.3d at 1087.

  • Hearing

    Apr 19, 2019

ERNESTO ESPINOZA VS. SERGIO PRASLIN

“The existence of federal sanctions for the filing of frivolous and malicious bankruptcy pleadings must be read as an implicit rejection of state court remedies. The mere possibility of being sued in tort in state court, with the potential for substantial damage awards, could deter persons from exercising their rights in bankruptcy. Thus, it is for Congress and the federal courts, not state courts, to decide what incentives and penalties shall be utilized in the bankruptcy process. [Citations Omitted.]”

  • Hearing

    Aug 31, 2017

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

  • County

    Los Angeles County, CA

PADILLA V. WECOSIGN, INC.

This is an issue for the bankruptcy court to decide, not this state court. At present, the enforceability/dischargability of the WeCosign judgments is an open issue. According to the memoranda on file, the issue is presently before the bankruptcy court, with no decision having yet been made. If the debts are dischargeable, they will be resolved in whole within the bankruptcy proceeding (and plaintiff’s adversary claims).

  • Hearing

    Mar 01, 2017

BEACH WHITMAN COWDREY V. TUTERA GROUP ET AL.,

DENY the judgment on the pleadings a to the fourth cause of action for fraud as the evaluation of that tort is a state court matter and not an issue of compensation for services as described in Bankruptcy Code §327 et seq. GRANT the request for judicial notice as to the records from the bankruptcy court: the notice of filing and the two pleadings filed in the bankruptcy docket. Ev. Code §452(d).

  • Hearing

    Feb 09, 2011

DORA JANE APUNA-GRUMMER VS. ROBERT ALLEN WILLBEE

In In re Beeney (9th Cir. 1992) 142 B.R. 360, 364, after receiving notice of discharge in a no asset case, plaintiff filed a motion to reopen the bankruptcy case and for an order allowing him to proceed with the state court case. The bankruptcy court denied his motion, stating there was no need to reopen his case, but implying that he should have taken action when the bankruptcy matter was open and thus could not proceed with the state case.

  • Hearing

    Nov 07, 2013

  • Type

    Personal Injury/ Tort

  • Sub Type

    Auto

PACIFIC CAPITAL BANK & TRUST VS FIDELITY NATIONAL TITLE ETC

A dispute arose in that development and a contractor asserted mechanics’ liens on the property as senior to Minnwest’s mortgage in a state court action. (Ibid.) Minnwest requested the title insurer to defend the action and to indemnify Minnwest. (Ibid.) The title insurer defended the action, but neither agreed to nor refused to indemnity Minnwest. (Id. at pp. *2-*3.) The state court subsequently issued an order ruling that the mechanics’ liens were superior to Minnwest’s mortgage. (Id. at p. *3.)

  • Hearing

    Jan 09, 2013

  • Judge Donna Geck
  • County

    Santa Barbara County, CA

VICKY REESE ET AL VS SERGIO MINGRAMM

Following Ybarra, the Ninth Circuit BAP found that a fee award for post-petition pursuit of cross-complaints in state court were not discharged in the debtor’s bankruptcy in Bechtold v. Gillespie (In re Gillespie), 516 B.R. 586, 588 (Bankr. 9th Cir. 2014). “The focus of Ybarra’s inquiry does not turn upon who is named as plaintiff and who is named as defendant.

  • Hearing

    Dec 16, 2014

IVAN RENE MOORE VS KIMBERLY MARTIN-BRAGG

However, a state court does not have concurrent jurisdiction to determine the scope and applicability of a stay with respect to a core bankruptcy proceeding. (In re Marriage of Sprague & Spiegel-Sprague (2003) 105 Cal.App.4th 215, 219.) Further, because the bankruptcy court has exclusive jurisdiction over objections to discharge, state court judgments construing the scope of the bankruptcy discharge are not preclusive. (In re Pavelich (9th Cir. BAP 1999) 222 BR 777, 783.)

  • Hearing

    Feb 21, 2018

  • Judge

    Georgina Torres Rizk or Jon R. Takasugi

  • County

    Los Angeles County, CA

REYES V. BARNELL

Here, plaintiffs have made a strategic decision to file actions in both state court and federal court regarding the same underlying facts, and involving some of the same claims. However, the pendency of the appeal in the bankruptcy action does not automatically stay the state court action, nor would it serve the interests of judicial efficiency to stay the present case until the bankruptcy appeal is resolved.

  • Hearing

    Nov 30, 2018

MAHVASH MAZGANI VS HOFFMAN LA BREA LLC ET AL

On July 22, 2020, Plaintiff filed a notice of removal of this action and the consolidated case BC622117 to bankruptcy court. When a state court action is removed to bankruptcy court, the state court loses jurisdiction and cannot act unless and until the bankruptcy court remands the action. (Fed. R. Bank. Proc. 9027, subd. (c); In re Princess Louise Corp. (Bank. Ct. C.D. Cal. 1987) 77 B.R. 766, 771.)

  • Hearing

    Jul 30, 2020

  • Type

    Real Property

  • Sub Type

    Quiet Title

PADILLA V. WECOSIGN, INC.

Once judgment in the State court action is obtained, however, the court expects that a judgment of this court will be sought before any levies can occur. That is the obvious import of the court’s earlier relief of stay order. These issues have to be litigated somewhere, either in the adversary proceeding or in the State Court Action. So, the debtor’s lament about having to expend funds and time in defending herself is not persuasive. Litigation, unfortunately, appears to be in the cards either way.”

  • Hearing

    Nov 01, 2016

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