Cook v. Wells Fargo Bank, N.A., Scott Garrett and Pamela Garrett (In re Cook)

Citation:
Cook v. Wells Fargo Bank, N.A., Case No. 04-17704 (B.A.P. 10th Cir. April 19, 2012) (unpublished)
Tag(s):
Ruling:
The Bankruptcy Appellate Panel AFFIRMED the bankruptcy court's order stating that the debtor, Daniel William Cook, lacks standing to assert sanctions against Wells Fargo N.A. and Mr. and Mrs. Garrett for alleged violations of the automatic stay.
Procedural context:
Appeal from the bankruptcy court for the United States District Court for the District of New Mexico which denied the debtor's motion to reconsider the order dismissing his motions for sanctions against Wells Fargo and the Garretts. Specifically, the bankruptcy court stated that (1) the debtor lacked standing because stay violations are estate property and can only be asserted by the trustee and (2) there was no violation of the automatic stay since the bankruptcy court had previously annulled it.
Facts:
The Debtor, an individual, working through various entities, developed or acquired intellectual property. This property was licensed to Wells Fargo. Mr. Garrett, a minority shareholder in one of the Debtor's various entities, provided a loan to the Debtor for $160,000 secured by the Debtor's primary residence. The funds were used to obtain and develop the intellectual property that was licensed to Wells Fargo. When the entity defaulted on the terms of the loan, Garrett sought foreclosure against the Debtor's real property. In 2004, the Debtor filed for a petition for Chapter 11 and, in 2008, the case was converted to Chapter 7. On April 21, 2008, the bankruptcy court granted Wells Fargo's Motion for Relief From Stay to foreclose its security interest in collateral to the extent that the collateral constituted property of the Debtor's estate.
Judge(s):
Nugent, Romero and Somers, Bankruptcy Judges.

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