Henkel v. Lickman (In Re Lickman)

301 B.R. 739, 17 Fla. L. Weekly Fed. B 9, 2003 Bankr. LEXIS 1561, 2003 WL 22794317
United States Bankruptcy Court, M.D. Florida·Decided November 25, 2003·No. Bankruptcy No. 98-02632-6W7. Adversary No. 01-170·Published·Cited by 16 cases

Opinion

ORDER AND MEMORANDUM DECISION DENYING MOTIONS FOR STAY PENDING APPEAL

MICHAEL G. WILLIAMSON, Bankruptcy Judge.

This adversary proceeding came on for hearing on September 12, 2003, of motions for stay pending appeal and supporting legal memoranda (Document Nos. 211, 212, 222, and 223) filed by Robert Dizak a/k/a Robert Daniels (“Daniels”), Paula Lickman (“Lickman” or “Debtor”), Gerald J. D’Am-brosio (“D’Ambrosio”), and James F. Wiley, III (“Wiley”) (“Defendants”). The motions seek to stay without bond the Plaintiffs execution on the money judgment entered jointly and severally against the Defendants on July 25, 2003 (Document No. 186) reported at Henkel v. Lickman (In re Lickman), 297 B.R. 162, 208 (Bankr.M.D.Fla.2003) (“Sanctions Decision”). Following the hearing the Defendants filed additional papers in support of their motions (Document Nos. 224, 225, and 226). After careful consideration of the record, the parties’ exhibits, 1 and the par *741 ties’ oral arguments, memoranda of law, and relevant legal authorities, the court concludes that the motions must be denied.

The Sanctions Decision.

In its July 25, 2003, Sanctions Decision the court found the Defendants hable for actions taken to assert or usurp control over property of the bankruptcy estate in violation of the automatic stay and this court’s October 18, 1999, sanctions order. Lickman, 297 B.R. at 207. In extensive findings of fact and conclusions of law, supported by a lengthy appendix, the court found that the Defendants sought control over a fifteen percent residuary interest in a probate estate — including putative claims against the executrix — that the Debtor received within 180 days of her bankruptcy filing (“Probate Asset”). Id. at 171. The Defendants’ actions occurred during two time periods.

This court found, based upon evidence contained in nearly 200 exhibits and testimony of six witnesses presented over a three day trial, that between August 1999 and April 2001, (“Phase I”) Daniels, the Debtor, and D’Ambrosio waged an unremittingly aggressive campaign — through telephone calls, letters, newspaper advertisements, and disciplinary complaints made to the Florida Bar — to dissuade the trustee from administering the Probate Asset. Id. at 170-77. That campaign proved unsuccessful and the trustee ultimately sold the Probate Asset with approval and order of the court. Id. at 175. D’Ambrosio then filed an altered document with the bankruptcy court in an effort to hasten the closing of the bankruptcy case to clear the way for further litigation in other courts. Id. at 176.

This court concluded that Daniels, the Debtor, and D’Ambrosio violated the automatic stay in taking these actions and as *742 sessed sanctions against them. Id. at 207. The court also concluded that Daniels, the Debtor, and D’Ambrosio acted in concert in violating the automatic stay and were thus jointly and severally liable. Id. at 198-200.

The record established in this proceeding also makes clear that beginning in May 2001 and extending long after the trial concluded, Daniels, the Debtor, and Wiley sought to wrest control of the Probate Asset and its proceeds from the trustee and return it to the Debtor through collateral attacks in other courts (“Phase II”). Id. at 178-186. Between May and August 2001, Daniels, the Debtor, and Wiley filed and prosecuted litigation in the Pennsylvania state and district courts against the trustee and her attorneys seeking to void the trustee’s sale of the Probate Asset and to obtain monetary damages for allegedly fraudulent acts taken by the trustee and her attorneys in connection with the sale. Id. at 178-79.

This court concluded that Daniels, the Debtor, and Wiley violated the automatic stay and this court’s October 18, 1999, sanctions order by taking these actions and assessed sanctions against them. Id. at 207-08. The court further concluded that Daniels, the Debtor, and Wiley acted in concert in taking these actions and were therefore jointly and severally liable. Id. at 198-200.

Accordingly, as a result of the Defendants’ actions, this court entered a permanent injunction enjoining Daniels, the Debtor, and Wiley from prosecuting pending collateral actions or filing future collateral attacks against property of the estate or the trustee and her counsel for their acts in administering the Debtor’s bankruptcy estate. The court also imposed significant monetary sanctions against all Defendants to compensate the estate for the harm resulting from their actions. The Defendants seek a stay of enforcement of the judgment. 2

Conclusions of Law on Motions for Stay Pending Appeal.

A motion for stay pending appeal is an extraordinary remedy and requires a substantial showing on the part of the movant. In re Running, 1990 WL 53063 (N.D.Ill.). F.R.B.P. 8005 provides that the movant must first seek such relief in the bankruptcy court.

In determining a motion for stay pending appeal, the court must consider four factors. “These factors are (1) whether the movant has made a showing of likelihood of success on the merits, (2) whether the movant has made a showing of irreparable injury if the stay is not granted, (3) whether the granting of the stay would substantially harm the other parties, and (4) whether the granting of the stay would serve the public interest.” Ruiz v. Estelle, 650 F.2d 555, 565 (5th Cir.1981). See also In re Brown, 290 B.R. 415, 424 (Bankr.M.D.Fla.2003); In re Bilzerian, 264 B.R. 726, 729 (Bankr.M.D.Fla.2001). The movant must show “satisfactory evidence on all four criteria, and the failure to satisfy one prong is fatal to the motion.” Brown, 290 B.R. at 424. The movant bears the burden of persuasion by a preponderance of the evidence. Rossi, McCreery & Assoc., Inc. v. Abbo (In re Abbo), 191 B.R. 680, 682 (Bankr.N.D.Ohio 1996).

A. Likelihood of Success on the Merits.

A showing that the movant has a likelihood of success on the merits is a prerequisite to the granting of a stay pending appeal. In re Permian Producers *743 Drilling, Inc., 263 B.R. 510, 515 (W.D.Tex.2000). A “likelihood of success is shown when the [movant] has raised ‘questions going to the merits so serious, substantial, difficult and doubtful as to make them a fair ground for litigation and thus for more deliberate inquiry.’ ” Colorado Public Utilities Comm. v. Yellow Cab Cooperative Ass’n (In re Yellow Cab Cooperative Ass’n), 192 B.R. 555, 557 (D.Co.1996), quoting United States ex rel. Citizen Band Potawatomi Indian Tribe v.

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Henkel v. Lickman (In Re Lickman), 301 B.R. 739, 17 Fla. L. Weekly Fed. B 9, 2003 Bankr. LEXIS 1561, 2003 WL 22794317 (Fla. 2003).

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