Stephen Griffin v. Lance Beaty ( 2006 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 05-3689
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Lance A. Beaty; Stephen B. Nelson; *
Great Western Resources, LLC; *
Mid-West Truck Equipment, Inc., *
*
Appellees, *
*
v. * Appeal from the United States
* District Court for the
Stephen A. Griffin, * Western District of Arkansas.
*
Appellant, * [UNPUBLISHED]
*
Family Shops, Inc.; Budget Tire & *
Supply Company, Inc.; Petroleum *
Equipment Co. Of Arkansas, Inc.; G & *
K Oil Company; NWA Family Shops, *
formerly known as Griffin-Mardis *
Investments Inc., formerly known as *
Flash Market Inc., Inc.; Bank of *
Arkansas, N.A.; First National Bank of *
Fort Smith; Arvest Bank; Community *
Bank of Northwest Arkansas; *
Farmers Bank of Greenwood; *
Tommy Mardis; John A. Griffin; G & S *
Oil Company; Steven Riggs; Highway *
71 South Liquors; Empire Liquor, Inc., *
*
Defendants. *
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Submitted: October 31, 2006
Filed: November 8, 2006
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Before RILEY, COLLOTON, and GRUENDER, Circuit Judges.
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PER CURIAM.
Stephen Griffin’s attorneys, David Nixon and Theresa Pockrus (“Griffin’s
Counsel”), appeal from the district court’s1 order affirming the bankruptcy court’s2
imposition of $1,100 in sanctions against them under Federal Rule of Bankruptcy
Procedure 9011.3 The bankruptcy court imposed the sanctions because Griffin’s
Counsel had filed, in Griffin’s name, counterclaims for which standing to sue rested
solely with the bankruptcy estate’s trustee.
We review the bankruptcy court’s imposition of sanctions for an abuse of
discretion. In re Coones Ranch, Inc., 7 F.3d 740, 743 (8th Cir. 1993). The bankruptcy
estate included Griffin’s counterclaims. 11 U.S.C. § 541(a)(1); Whetzal v. Alderson,
32 F.3d 1302, 1303 (8th Cir.1994). The bankruptcy trustee had the capacity to sue
and be sued with respect to the estate’s property. 11 U.S.C. § 323. Griffin’s Counsel
failed to establish any exception to the general rule that “a debtor may not prosecute
1
The Honorable Robert T. Dawson, United States District Judge for the Western
District of Arkansas.
2
The Honorable James G. Mixon, United States Bankruptcy Judge for the
Western District of Arkansas.
3
Although record documents refer to Griffin as the appellant, Griffin’s Counsel
are the real parties in interest in this appeal.
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on his own a cause of action belonging to the estate unless that cause of action has
been abandoned by the trustee.” Vreugdenhil v. Hoekstra, 773 F.2d 213, 215 (8th Cir.
1985); cf. Wissman v. Pittsburgh Nat’l Bank, 942 F.2d 867, 869-71 (4th Cir. 1991)
(where cause of action was exempt under bankruptcy laws and therefore not property
of bankruptcy estate, debtor had standing to bring cause of action in own name
without trustee’s formal abandonment of claim). We conclude that the bankruptcy
court’s imposition of sanctions was not an abuse of discretion. See Cooter & Gell v.
Hartmarx Corp., 496 U.S. 384, 404 (1990) (trial court is best situated to determine
when sanctions are warranted; deference to determination of courts on front lines of
litigation enhances courts’ ability to control litigants).
Accordingly, we affirm. See 8th Cir. R. 47B.
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