G. Jeff Mennen v. Onkyo Corporation , 248 F. App'x 112 ( 2007 )

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
U.S. COURT OF APPEALS
___________________ ELEVENTH CIRCUIT
SEPTEMBER 13, 2007
No. 06-12050 THOMAS K. KAHN
___________________ CLERK
D.C. Docket No. 04-80581-CV-DMM
G. JEFF MENNEN AND WILMINGTON TRUST COMPANY,
Co-Trustees u/a Dated November 29, 1970,
with George S. Mennen FBO John Henry Mennen,
Plaintiff-Appellant,
versus
ONKYO CORPORATION,
ONKYO MALAYSIA SDN. BHD.,
ONKYO EUROPE ELECTRONICS GMBH,
Defendants-Appellees.
__________________
Appeal from the United States District Court
for the Southern District of Florida
__________________
(September 13, 2007)
Before DUBINA and MARCUS, Circuit Judges, and COOGLER,* District Judge.
PER CURIAM:
*
Honorable L. Scott Coogler, United States District Judge for the Northern District of
Alabama, sitting by designation.
Plaintiff-Appellant, the Mennen Trust (“the Trust”), brought an action against
Defendants-Appellees under Florida law for fraud, negligent misrepresentation, false
information negligently supplied, and conspiracy. The Trust sought to recover a $12
million loan that helped to finance Global Technovations, Inc’s (“GTI”) acquisition
of Onkyo America, Inc. (“OAI”) from Defendants-Appellees in 2000, as well as an
additional $11 million investment the Trust contends was made in an effort to save
its original loan. The Trust appeals the district court’s March 2, 2006, order entering
final judgment for Defendants-Appellees following a written order entered the
previous day, which granted the defendants’ motion for a directed verdict due to the
Trust’s lack of standing.
“We review de novo questions concerning our subject matter jurisdiction,
including standing and ripeness.” Elend v. Basham, 471 F.3d 1199, 1204 (11th Cir.
2006) (citing Fla. Pub. Interest Research Group Citizen Lobby, Inc. v. EPA, 386 F.3d
1070, 1082 (11th Cir. 2004); London v. Wal-Mart Stores, Inc., 340 F.3d 1246, 1251
(11th Cir. 2003)). “When considering whether or not a ruling on a motion for
directed verdict or for judgment notwithstanding the verdict should be upheld, the
standard of review to be applied by this Court is the same as that applied by the
district court.” Hipp v. Liberty Nat'l Life Ins. Co., 252 F.3d 1208, 1230 (11th Cir.
2001) (per curiam). “Thus, we consider all the evidence, and the inferences drawn
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therefrom, in the light most favorable to the nonmoving party. If the facts and
inferences point overwhelmingly in favor of one party, such that reasonable people
could not arrive at a contrary verdict, then the motion was properly granted.” Id.
The district court concluded that the Trust’s claims in this case belong to the
bankruptcy estate of GTI and are therefore barred. 11 U.S.C. § 541(a) “establishes
a debtor's bankruptcy estate” as including “all legal and equitable interests of the
debtor in property as of the commencement of the case.” In re Icarus Holding, LLC,
391 F.3d 1315, 1319 (11th Cir. 2004). “This includes legal causes of action the
debtor had against others at the commencement of the bankruptcy case.” Id. Said
another way, the “bankruptcy trustee stands in the shoes of the debtor and has
standing to bring any suit that the debtor could have instituted had it not been thrown
into bankruptcy.” O'Halloran v. First Union Nat’l Bank of Fla., 350 F.3d 1197, 1202
(11th Cir. 2003). Furthermore, “[i]f a cause of action belongs to the estate, then the
trustee has exclusive standing to assert the claim.” In re Educators Group Health
Trust, 25 F.3d 1281, 1284 (5th Cir. 1994); accord Parker v. Wendy's Int'l, Inc., 365
F.3d 1268, 1272 (11th Cir. 2004). “If a cause of action alleges only indirect harm to
a creditor (i.e., an injury which derives from harm to the debtor), and the debtor could
have raised a claim for its direct injury under the applicable law, then the cause of
action belongs to the estate.” In re Educators Group Health Trust, 25 F.3d at 1284.
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After full review of the record, reading the parties’ briefs,1 and having the
benefit of oral argument, we affirm the district court. The bankruptcy estate of GTI
has filed suit in the United States Bankruptcy Court for the Eastern District of
Michigan against Defendants-Appellees. In that action, GTI’s bankruptcy estate
seeks to recover its alleged financial losses stemming from the same acquisition
transaction at issue in this case. To the extent the Trust seeks to recover the monies
it invested in GTI during and after the acquisition transaction, there is insufficient
evidence to establish that the Trust was “distinctly and individually damaged” or
suffered a “loss [that] can be separated from the loss of the debtor corporation.” In
re All Am. of Ashburn, Inc., 805 F.2d 1515, 1518 (11th Cir. 1986) (per curiam). To
the extent the Trust seeks to recover its loan to OAI, undisputed evidence in the
record shows that GTI had pledged to repay OAI’s debt to the Trust if OAI became
unable to make its monthly payments. Further evidence shows that GTI began
making those monthly payments to the Trust on OAI’s behalf. Because GTI became
liable for OAI’s debt, its bankruptcy estate had exclusive standing to bring a cause
of action for those losses as well.
AFFIRMED.
1
Appellees’ “Motion to Strike Portions of the Mennen Trust’s Reply Brief . . . ,” which
was carried with the case, is DENIED.
4