Law Office of Rogelio Solis v. Curtis
- Case Type:
- Business
- Case Status:
- Affirmed in part and Reversed in part
- Citation:
- 22-20430 (5th Circuit, Oct 06,2023) Published
- Tag(s):
-
- Ruling:
- Under 28 U.S.C. § 1961(a), a judgment entered by a bankruptcy court in an adversary proceeding must include post-judgment interest because a bankruptcy court is a unit of the district court (28 U.S.C. § 151) and an adversary proceeding judgment is civil in nature, as indicated by the language of Fed. R. Bankr. P. 7001 and 28 U.S.C. § 1334(b).
- Procedural context:
- The appellants, who had originally won in bankruptcy court, appealed a bankruptcy court's decision that dramatically reduced the amount of damages awarded to the appellants (from more than $1.9 million, plus $326,000 in attorney's fees, plus post-judgment interest, to a judgment of $4,000, plus $92,000 in attorney's fees).
- Facts:
- Imperial Petroleum Recovery Corporation ("IPRC") operated microwave separation technology equipment to recover usable oil from various emulsions. The appellants (the "Carmichaels") had security interests in two MST-1000 microwave separation machines used by IPRC. In January 2013, the Carmichaels filed an involuntary chapter 7 petition against IPRC.
Before the Carmichaels could recover the two MST-1000s that were subject to their security interest, IPRC sent the machines to the appellees (the "Balkes") for repair.
Ultimately, the Carmichaels received one damaged and partially disassembled MST-1000 and some spare parts. The Carmichaels then sued the Balkes in bankruptcy court for damages resulting from the Balkes' alleged automatic stay violations.
After three years of litigation, the bankruptcy court entered an 82-page opinion awarding the Carmichaels damages of more than $1.9 million and attorney's fees of $326,000. The judgment also ordered the Balkes to pay post-judgment interest.
The Balkes appealed to the district court. While the appeal was pending, the original bankruptcy judge retired, and the case was assigned to another bankruptcy judge. On remand, the new judge (Judge Isgur) amended the original opinion because there had been out-of-court testimony by an IPRC employee that IPRC had delivered only one MST-1000 unit to the Balkes. Judge Isgur admitted the deposition under Fed. R. Evid. 807 because nothing suggested that the deposition transcript, or the former employee's testimony itself, were unreliable. Judge Isgur thus reduced the damages award, finding that the Carmichaels were entitled to the cost of repair and reassembly of the one MST-1000.
- Judge(s):
- Ho, Oldham, and Douglas, Circuit Judges
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