Summary:
Despite having received notice of the bankruptcy filing and notice of the proof of claims deadline well before the expiration of the deadline and approximately thirteen months prior to confirmation of the Amerson's Second Amended Plan, Flanders, who was represented by counsel during much toe the Chapter 11 proceeding, did not take any action in the bankruptcy proceeding to request relief from the automatic stay or to file a proof of claim. Despite that knowledge, Flanders made direct, post-petition threats to Amerson, including asserting multiple causes of action against Amerson.
As this was a Chapter 11 filed by individuals, the discharge was not entered at the time of confirmation, and Amerson did not request an early discharge. As such, pursuant to 11 U.S.C. § 362(c)(2), the automatic stay remains in effect until the case is closed or the discharge is entered. Accordingly, the bankruptcy court held that Flanders, despite not filing a claim in the case, was fully aware of the bankruptcy and should have, before bringing suit against Amerson, sought relief from the automatic stay. As such, the bankruptcy court awarded Amerson his actual costs, including attorneys' fees of $35,576.64, but declined to award punitive damages.
For a copy of the opinion, please see:
Amerson- Violation of the Automatic Stay; Termination of Automatic Stay in an Individual Chapter 11
Amerson- Part II
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