KEVIN S. WANG V. JAY S. HELLMAN
- Summarized by Stephen Falanga , Walsh Pizzi O'Reilly Falanga LLP
- 9 months 1 week ago
- Case Type:
- Business
- Case Status:
- Dismissed
- Citation:
- 24-1738, 24-1742 & 24-1743 (2nd Circuit, May 15,2025) Not Published
- Tag(s):
-
- Ruling:
- In a summary order, the Second Circuit dismissed consolidated appeals by a non-debtor tenant who was evicted from the underlying debtor's business property which was sold to a third party under 11 U.S.C. 363. The Second Circuit agreed with the district court that the appeals of the sale orders were moot given the purchaser was a "good faith" purchaser under 363(m) and the appeal of the eviction order was moot as the appellant was already removed from the property. The Second Circuit also concluded that equitable mootness also barred the appeals as the debtor's plan was largely consummated.
- Procedural context:
- Appellant, former tenant, appealed from three district court orders dismissing the appeals of three separate bankruptcy court orders - two Sale Orders and an Eviction Order - concerning the sale of debtor assets and property. The district court dismissed the appeals of the Sale Orders as statutorily moot finding that the assets were sold to good-faith purchasers for value pursuant to 11 U.S.C. §363(m). The district court also dismissed the appeal of the Eviction Order as moot determining that Appellant had already been evicted from the parking garage.
Appellant appealed from the district court’s orders of dismissal to the Second Circuit which dismissed all three appeals as moot.
- Facts:
- The non-debtor tenant challenged bankruptcy court orders: (1) approving the sale of a parking garage owned by tehe debtor, Clean Air Car Service & Parking Branch Two, LLC (“Clean Air 2”) to an unaffiliated purchaser for value at a public auction; (2) approving the sale of an office building owned by the debtor, Operr Plaza, LLC (“Operr Plaza”) to a different unaffiliated purchaser for value at a public auction (collectively, the “Sale Orders”); and (3) evicting the appellant from the parking garage formerly owned by Clean Air 2 (the “Eviction Order”).
The Second Circuit concluded that the CleanAir 2 and Operr Plaza properties were each sold at a fair and competitive auction on December 7, 2023, and there was no evidence of fraud or collusion, which was sufficient to establish that the purchasers paid value for the assets. The Second Circuit also determined for purposes of this appeal that appellant's "adverse claims" contentions would not bear on the buyers’ status as good-faith purchasers.
The Court also dismissed the eviction order appeal given the appellant had already been out of possession of the sold property, the appellant had no right to possession or tenancy no effective relief could granted.
- Judge(s):
- LYNCH, MERRIAM and ARAÚJO KAHN
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