Landrum v. Otero County Hospital Ass'n (In re Otero County Hospital Ass'n)

560 B.R. 551
CourtUnited States Bankruptcy Court, D. New Mexico
DecidedNovember 7, 2016
DocketCase No. 11-11-13686 JA; Adversary No. 15-1016 J
StatusPublished
Cited by1 cases

This text of 560 B.R. 551 (Landrum v. Otero County Hospital Ass'n (In re Otero County Hospital Ass'n)) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, D. New Mexico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Landrum v. Otero County Hospital Ass'n (In re Otero County Hospital Ass'n), 560 B.R. 551 (N.M. 2016).

Opinion

MEMORANDUM OPINION

ROBERT H. JACOBVITZ, United States Bankruptcy Judge

THIS MATTER is before the Court for a trial on the merits.1 Plaintiff Cady Land-rum (referred to hereinafter as “Plaintiff’ or Ms. Landrum) fíled a complaint in state court against Dr. Surgit Moolamalla in the Twelfth Judicial District Court, Otero County, State of New Mexico as Case No. D-1215-CV-2014-0605 (the “State Court Action”). In this adversary proceeding, she seeks a declaratory judgment determining, (i) 11 U.S.C. § 362(a) does not enjoin the State Court Action; (ii)§ 524(a) does not enjoin the State Court Action; (iii) the plan (the “Plan”) confirmed in the Chapter 11 bankruptcy case (“Bankruptcy Case”) filed by Defendant Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering) (the “Hospital”) does not enjoin the State Court Action; (iv) she has not waived her claim against Dr. Moolam-alla by not filing an administrative claim in the Bankruptcy Case; and (v) she did not willfully violate § 362(a).2 Defendants oppose Plaintiffs request for declaratory judgment with respect to items iii and iv of the list above, but do not oppose Plaintiffs request with respect to items i, ii, and v. Defendants counterclaimed seeking a declaratory judgment that the Plan and § 1141(d) enjoin the State Court Action and further request that the Court hold Plaintiff in contempt of court and award Defendants damages.3

Prior to the trial, the Court entered its Order Granting, in Part, and Denying, in Part, Defendants’ Motion for Summary Judgment (Partial) (Docket No. 25) (the “Summary Judgment Order”). In the Summary Judgment Order, the Court held: (i) the language of Section 14.20 of the Plan (the “Plan Injunction”) is broad enough to bar Plaintiffs claims against Dr. Moolam-alla asserted in the State Court Action if Dr. Moolamalla was an employee of the Debtor when he performed the medical procedure on Plaintiff; and (ii) Plaintiff received actual notice of the commencement of the Bankruptcy Case, the hearing on confirmation of the Plan (which included notice of the Plan Injunction), confirmation of the Plan, and the bar date for filing administrative claims in the Bankruptcy Case. The remaining issue for trial is whether the content of the notices Plaintiff received satisfied the requirements of due process. For the reasons explained below, the Court holds that the notices Plaintiff received satisfied the requirements of due process.

[555]*555Findings of Fact4

A. The Plan and the Plan Injunction.

The Hospital operates the Gerald Champion Regional Medical Center (“GCRMC”) in Alamogordo, New Mexico. See Pre-Trial Order, p. 7. The Hospital commenced the Bankruptcy Case on August 16, 2011 (the “Petition Date”) by filing a voluntary petition under Chapter 11 of not the Bankruptcy Code. The Hospital filed the Plain on June 20, 2012. The Plan included the Plan Injunction, which provides as follows:

On the Effective Date and except as otherwise provided in the Plan, all Persons who have been, are, or may be holders of Claims against the Debtor shall be permanently enjoined from taking any of the following actions against or affecting the Debtor, the Estate, the Assets or the Disbursing Agent, or any of their current or former respective members, directors, managers, officers, employees, agents, and professionals, successors and assigns or their respective assets and property with respect to such Claims (other than actions brought to enforce any rights or obligations under the Plan):
(i) commencing, conducting or continuing in any manner, directly or indirectly, any suit, action or other proceeding of any kind (including, without limitation, all suits, actions, and proceedings that are pending as of the Effective Date, which must be withdrawn or dismissed with prejudice);
(ii) enforcing, levying, attaching, collecting or otherwise recovering by any manner or means, whether directly or indirectly, any judgement, award, decree or order ....

Id. The Court entered the Order Confirming Chapter 11 Plan (Bankruptcy Case Docket No. 712) (the “Confirmation Order”) confirming the Plan on August 7, 2012. The Confirmation Order contains language that is effectively the same as the Plan Injunction. See id. The Plan became effective September 19, 2012 (the “Effective Date”). See id.

B. Notice of the Plan and Plan Injunction.

Plaintiff had actual notice of the Bankruptcy Case no later than January 2012. Plaintiff was included on the confidential service list filed in the Chapter 11 Case (the “Patient Service List”). See id. Plaintiffs address on the Patient Service List was listed as P.O. Box 897, La Luz, New Mexico 88337. See id. Plaintiff that used and regularly received mail at that P.O. Box. See id. The Court appointed Kurtz-man Carson Consultants LLC (“KCC”) to serve as the claims, noticing, and balloting agent in the Chapter 11 Case. See id. at p. 8. KCC mailed the following notices given in the Chapter 11 Case to Plaintiff:

(i) Notice of Commencement of Chapter 11 Bankruptcy Case [Bankr. D.I. 73], mailed by First Class mail on August 23, 2011. See Affidavit of Service (Bankruptcy Case No. 11 — 13686—jll, Docket No. 83);
(ii) Notice to Patients Concerning (a) Hearing to Consider Plan Confirmation and (b) Deadline to file Objections to the Plan, mailed by First Class mail on June 25, 2012. See Amended Affidavit of Service and Exhibit E to Amended Affidavit of Service (Bankruptcy Case No. 11-13686 — jll, Docket No. 622);
[556]*556(iii) Notice of (a) Solicitation of Votes to Accept or Reject the Third Amended Chapter 11 Plan of Reorganization for Otero County Hospital Association, Inc. dated June 20, 2012 (b) Hearing to Consider Plan Confirmation and (c) Deadline for' Filing Objections to the Plan (the “Confirmation Notice”), mailed by First Class mail on June 23, 2012. See Amended Affidavit of Service and Exhibit A to Amended Affidavit of Service (Bankruptcy Case No. 11-13686-jll, Docket No. 622); and
(iv) Notice of (a) Entry of Order Confirming Third Amended Chapter 11 Plan of Reorganization for Otero County Hospital Association, Inc.; (b) Occurrence of Effective Date; and (c) Bar Dates for Asserting Administrative Claims, Fee Claims and Rejections Claims (“Bar Date Notice”) (Bankruptcy Case No. 11-13686-jll, Docket No. 770), mailed on September 21, 2012. See Affidavit of Service (Bankruptcy Case No. 11-13686-jll, Docket No. 788).

Id.

The Confirmation Notice, which is just over two pages exclusive of the signature blocks, provided notice of the final confirmation hearing date scheduled for August 3, 2012, and included the following language in boldface type:

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Bluebook (online)
560 B.R. 551, Counsel Stack Legal Research, https://law.counselstack.com/opinion/landrum-v-otero-county-hospital-assn-in-re-otero-county-hospital-assn-nmb-2016.