Crest One SpA v. TPG Troy, LLC (In the Matter of TPG Troy, LLC)

Citation:
2015 U.S. App. LEXIS 12085
Tag(s):
Ruling:
Order affirming District Court affirming District Court decision affirming Bankruptcy Court 1) dismissing involuntary petition; 2) denying the petitioners’ motion to withdraw the reference; and 3) awarding $513,427.16 in attorneys’ fees and costs pursuant to 11 U.S.C. § 13 303(i)(1).
Procedural context:
Appeal from District Court affirming Bankruptcy Court
Facts:
Petitioners were involved in many pending actions against the debtor and its related entities. The petition was dismissed because a.) petitioners’ claim were subject to bona fide disputes; and b.) question of whether the debtor and related entities were involved in transactions involving the debtor and related entities. Also, court found basis for abstention under 11 U.S.C. § 305. The bankruptcy court wouldn’t award punitive damages, saying the substantial attorneys’ fee award would provide a deterrent to others. The 2nd Circuit found that attorneys’ fees could be awarded under 303(I) despite the bankruptcy court abstaining. It also found that petitioners waived the right to a jury trial over attorneys’ fees during colloquy before the bankruptcy court concerning punitive damages. The 2nd Circuit agreed that pending litigation alone will create a bona fide dispute. However, vigorous extended litigation can. Using the “totality of the circumstances” test in computing attorneys’ fees was approved.
Judge(s):
Winter, Pooler and Sack, Circuit Judges

ABI Membership is required to access the full summary. Please Sign In using your ABI Member credentials. Not a Member yet? Join ABI now - it is absolutely worth it!

About us in numbers

3060 in the system

2952 Summarized

1 Being Processed