Fire Eagle L.L.C. v. Bischoff (In re Spillman Development Group, Ltd.)
- Citation:
- 5th Cir. Court of Appeals - Case No. 11-51057
- Tag(s):
-
- Ruling:
- The Court of Appeals AFFIRMED the District Court's ruling, which affirmed the bankruptcy court's ruling that granted the summary judgment of two consolidated matters.
- Procedural context:
- Fire Eagle, a creditor, appealed the bankruptcy court's ruling to the District Court. The District Court affirmed, and Fire Eagle again appealed to the Court of Appeals on numerous grounds.
- Facts:
- In November 2011, Spillman Development Group, LTD ("SDG") took out a series of loans to finance a construction of a golf course from American Bank of Texas ("BofT"). BofT loaned a total of $8.1 million which was secured by liens on SDG's assets and limited guarantees by SDG's principals which had a forum-selection clause requiring any suits against the guarantors be brought in Grayson County, Texas. SDG also borrowed $4.1 million from Fire Eagle which was not secured against guarantees by SDG or its principals.
On August 1, 2005, SDG filed for bankruptcy listing BofT and Fire Eagle as its principal creditors. After various debt purchases by Fire Eagle and credit bids, the bankruptcy court accepted Fire Eagle's bid and held that Fire Eagle's credit had paid in full the senior indebtedness, thereby leaving Fire Eagle with no deficiency claim against SDG's estate. SDG's principals, thereafter, filed an adversary proceeding seeking declaratory judgment that, as a result of the sale, the principals should be relieved of the guaranty agreements. Fire Eagle opposed the motion, requesting it be dismissed, and filed its own action against a guarantor in the Eastern District of Louisiana asserting that the credit bid had not paid in full the senior indebtedness and it could thereby collect against the guarantees. The bankruptcy court in Texas denied Fire Eagle's motion to dismiss the guarantors adversary proceeding and granted the plaintiff's request for summary judgment. The district court in Louisiana thereafter granted the guarantor's motion to transfer venue to Texas and then the bankruptcy court consolidated the two matters. Thereafter, the principal request a summary judgment which was granted by the bankruptcy court.
- Judge(s):
- Circuit Court Judges REAVLEY, DENNIS and CLEMENT.
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