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Cohen v. CDR Creances (In re Euro-American Lodging Corp.)

Cohen v. CDR Creances (In re Euro-American Lodging Corp.), 13-1308-BK, --- Fed. App. --- Summary Order (2d Cir. Jan. 10, 2014)
This opinion is of no precedential effect. The Second Circuit affirmed the bankruptcy court's denial of an application by the debtor's former president, Leon Cohen, to reopen the Chapter 11 case after the plan of reorganization had been confirmed and the estate had been fully administered. The Second Circuit held that the bankruptcy court did not abuse its discretion in finding that (1) cause did not exist to reopen the bankruptcy proceedings and (2) the bankruptcy court lacked jurisdiction to issue some of the relief sought by Cohen. Specifically, because Cohen was a non-debtor seeking a release or discharge, he had to demonstrate "cause" to reopen the bankruptcy case, which the Second Circuit held required a finding by the bankruptcy court that "truly unusual circumstances render the release terms important to the success of the plan." Additionally, Cohen was asking the bankruptcy court to exercise post-confirmation jurisdiction, which was found by the bankruptcy court and Second Circuit not to be warranted.
Procedural context:
Cohen appealed from the order of the Bankruptcy Court for the Southern District of New York denying his application under 11 U.S.C. § 350(b) to reopen the Chapter 11 case. The District Court for the Southern District of New York affirmed the Bankruptcy Court's denial of Cohen's application and the Second Circuit, reviewing de novo, affirmed as well.
CDR Creances S.A.S. ("CDR") had commenced the involuntary Chapter 11 bankruptcy of Euro-American Lodging Corp. ("EALC") in 2006. Leon Cohen had once served as the president of EALC, but at the time of the appeal was serving a prison term for tax fraud and facing civil fraud actions against him by CDR in multiple state courts. After EALC's plan had been confirmed and the estate fully administered, Cohen sought to reopen the case to obtain certain releases and discharges in favor of Cohen, in an effort to bar CDR's state court actions against him.
Dennis Jacobs Denny Chin Susan L. Carney

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