Meridian Capital v. Burton

Case Type:
Case Status:
No. 18-40003, 2019 WL 101886 (5th Circuit, Jan 04,2019) Not Published
Because the tortious interference claim alleging a direct injury to the company's former CEO is not property of the estate, there is no basis for bankruptcy court jurisdiction.
Procedural context:
Burton sued Meridian Capital in state court, alleging tortious interference with contract as well as claims of conspiracy and assisting. Meridian Capital removed the case to the bankruptcy court, arguing that the claims belonged to the debtor's estate and were thus released in a settlement that Meridian Capital and Buccaneer reached. The bankruptcy court mostly disagreed, concluding that the tortious interference claim belonged to Burton and thus should be litigated in state court. The district court later remanded the claims to state court.
Buccaneer was an oil exploration and production company. When Buccaneer filed for chapter 11, Meridian Capital (plaintiff) held all of its senior debt. Burton (defendant) was Buccaneer's CEO from the company's founding. Shortly before the bankruptcy filing, Buccaneer fired Burton.
Wiener, Southwick, Costa

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