Hous. Bluebonnet, L.L.C. v. JPMorgan Chase Bank (In re Hous. Bluebonnet, L.L.C.)

586 B.R. 837
CourtDistrict Court, S.D. Texas
DecidedJune 14, 2018
DocketBANKRUPTCY NO. H–16–34850–11; CIVIL ACTION NO. H–17–3270
StatusPublished
Cited by2 cases

This text of 586 B.R. 837 (Hous. Bluebonnet, L.L.C. v. JPMorgan Chase Bank (In re Hous. Bluebonnet, L.L.C.)) is published on Counsel Stack Legal Research, covering District Court, S.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hous. Bluebonnet, L.L.C. v. JPMorgan Chase Bank (In re Hous. Bluebonnet, L.L.C.), 586 B.R. 837 (S.D. Tex. 2018).

Opinion

SIM LAKE, UNITED STATES DISTRICT JUDGE

*839This Memorandum Opinion and Order addresses an appeal brought by Houston Bluebonnet, L.L.C. ("Houston Bluebonnet," "Appellant," or "Debtor") from the

Order Granting Movants' Motion for Approval and Determining Their Informal Proofs of Claim Lack Prima Facie Validity, signed October 10, 2017 ("Order Approving Informal Proof of Claims"), Docket Entry No. 68;1

entered in Bankruptcy Case No. H-16-34850-11 (the "Bankruptcy Case") for reasons stated in the Memorandum Opinion (Docket Entry No. 69) signed the same day.2 For the reasons explained below, the order of the Bankruptcy Court will be affirmed.

I. Factual and Procedural Background 3

Appellant is the Debtor in the Bankruptcy Case filed on September 30, 2016 (Case No. H-16-34850-11) in the United States Bankruptcy Court for the Southern District of Texas, Houston Division ("Bankruptcy Court"), and a successor-in-interest to Humble Oil and Refining Company ("Humble") and to Producers Oil Company ("Producers"). Appellees are representatives of two groups seeking to assert claims against the Debtor: (1) successors-in-interest to an assignment executed in 1913 by John Hamman to Producers ("the Hammans"); and (2) Successors-in-interest to an assignment executed in 1919 by Dan A. Japhet, et al. to Humble ("the Japhets"). In 2004 the Japhets filed a lawsuit against various defendants in the 14 9th District Court of Brazoria County, Texas (Cause No. 30776-CV), alleging that under a chain of title descending from Dan A. Japhet, they own an undivided 52/60th working interest of the net profits realized by Humble's successors from the operations conducted on 20 acres leased under the 1919 assignment. In their state court lawsuit the Japhets sought inter alia specific performance of the 1919 lease, judgment for damages and prejudgment interest arising from the defendants' failure to pay the net profits interest when required; and a declaration that, due to defendants' defaults under the lease, the lease terminated and the rights reverted back to them.4 On March 19, 2009, the Japhets added the Debtor as a defendant in their state court case.5

*840On November 25, 2013, Henry R. Hamman and the George and Mary Josephine Hamman Foundation filed suit in the 14 9th District Court of Brazoria County, Texas (Cause No. 75054-CV), against various defendants-including the Debtor-claiming to have succeeded to a portion of the net proceeds interest reserved by George Hamman in a 1913 assignment to Producers. The Hammans' lawsuit sought inter alia damages stemming from the defendants' failure and refusal to perform under the 1913 assignment, and damages and prejudgment interest for all net proceeds due to them thereunder.6

On September 30, 2016, the Debtor filed a voluntary Chapter 11 bankruptcy petition, and removed the Japhets' state court lawsuit to the Bankruptcy Court thereby initiating Adversary No. 16-03225.7 Attached to the Notice of Removal was the entire record of the Japhets' state court lawsuit, including the live pleading, Plaintiffs' Seventh Amended Petition filed on June 1, 2016.8 On October 5, 2016, the Japhets filed Plaintiffs' Motion for Abstention and for Remand,9 which the Bankruptcy Court granted for the reasons stated in a December 6, 2016, Memorandum Opinion.10 On December 12, 2016, the Japhets filed a motion for relief from the automatic stay in order to prosecute their state court action to final judgment.11 Subsequently, the state court held a trial in March of 2018, resulting in a jury verdict for the Japhets of over $1.3 million.12

The Debtor removed the Hammans' state court lawsuit to the Bankruptcy Court on November 9, 2016, thereby initiating Adversary No. 16-03251.13 The Notice of Removal contained the entire record of the Hammans' state court lawsuit, including the live pleading, Plaintiffs' Second Amended Petition filed on September 2, 2016.14 On December 16, 2016, the Hammans and the Debtor filed their Joint Discovery/Case Management Plan in the Bankruptcy Court.15 On May 16, 2017, the Hammans filed a Motion for Leave to File *841Plaintiffs' Third Amended Complaint,16 and on July 10, 2017, they filed Hammans' Motion for Partial Summary Judgment Regarding 1920 Agreement,17 which the Bankruptcy Court granted on September 15, 2017.18

The Debtor listed the Japhets and the Hammans as unsecured creditors with unliquidated, disputed claims in both its Original Schedule F and Amended Schedule F, but neither the Japhets nor the Hammans filed proofs of claim by the claims bar date of February 13, 2017.19 Instead, on September 7, 2017, the Appellees filed the Joint Motion of the Japhet and Hamman Parties for Approval of Certain Pleadings and Other Filings as Their Respective Informal Proofs of Claim ("Joint Motion").20 Appellees argued in the Joint Motion that the filings in their state court lawsuits that the Debtor removed to the Bankruptcy Court included detailed written allegations of fact and law stating their claims against the Debtor and seeking payment of their net profits and proceeds interests.21

On September 22, 2017, Debtor responded to the Joint Motion arguing that Appellees' filings did not satisfy the Fifth Circuit's requirements for informal proofs of claim stated in Nikoloutsos v. Nikoloutsos (In re Nikoloutsos), 199 F.3d 233, 236 (5th Cir. 2000).22 The Debtor also argued that the Japhets' filings were not informal claims because they did not show an intent to pursue a claim in the Bankruptcy Court but, instead, insisted that all disputes be resolved in state court, and that the Hammans' pleadings and filings should not be considered as informal proofs of claim because they were filed after the claims bar date.23 On September 26, 2017, the Debtor filed Debtor's Supplemental Response to Joint Motion of the Japhet and Hamman Parties for Approval of Certain Pleadings and Other Filings as Their Respective Proofs of Claim (Doc. 59) ("Debtor's Supplemental Response").24 The Debtor argued that the Appellees' state court filings could not be considered as informal proofs of claim because they were filed with the state court, not the Bankruptcy Court, the notices of removal to which they were attached were filed by the Debtor not by the purported claimants and, therefore, could not be considered claims filed on behalf of a creditor, and the removals were not filed within the time period for filing claims against the Debtor.25

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Cite This Page — Counsel Stack

Bluebook (online)
586 B.R. 837, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hous-bluebonnet-llc-v-jpmorgan-chase-bank-in-re-hous-bluebonnet-txsd-2018.