Bankr. E.D.N.C.: In re Clements- Temporary Allowance of Claim for Voting Purposes

Summary: The creditor had obtained a judgment against the debtor, with such judgment still being on appeal. The creditor, nonetheless, filed a Proof of Claim in the debtor’s Chapter 11 case, to which the debtor objection. Read together, 11 U.S.C. § 502(a) and 1126(a) prohibit a claimant from voting on a Chapter 11 plan if the debtor has objected to the claim. Bankruptcy Rule 3018(a), however, allows the bankruptcy court, at its sound discretion, to temporarily allow the claim for purposes of accepting or rejecting the proposed plan. Finding that the Rooker-Feldman doctrine precluded it from reviewing the underlying state court judgment, especially while it is on appeal. Accordingly, the bankruptcy court allowed the creditor a temporary claim in the full amount of its judgment. For a copy of the opinion, please see: Clements- Temporary Allowance of Claim for Voting Purposes.pdf