In Re: Sonya Laraye Owens ( 2020 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
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IN RE: SONYA LARAYE OWENS : Civil Action No.: 19-2491 (RC)
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: Re Document Nos.: 1, 12, 13
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MEMORANDUM OPINION
DISMISSING APPEAL
I. INTRODUCTION
Before the Court is Ms. Sonya LaRaye Owens’s appeal from the U.S. Bankruptcy Court
for the District of Columbia. Ms. Owens seeks review of multiple related orders: an order that
lifted an automatic stay Chapter 11, an order dismissing her petition, an order barring her from
certain future filings, and related procedural orders. Because the Court finds that the Bankruptcy
Court did not clearly err in its finding of facts or abuse its discretion, and because several of the
appealed orders are moot, the Court affirms in all aspects and dismisses the appeal.
II. BACKGROUND
The factual background of this bankruptcy appeal involves several related proceedings
centered around the foreclosure and sale of Ms. Owens’s home (“the property”) and subsequent
eviction proceedings before D.C. courts. On February 21, 2017, Ms. Owen’s home was
foreclosed upon and sold to Reliance Partners LLC (“Reliance”), the Appellee here. Mem.
Decision and Order Den. Mot. to Reconsider Dismissal at 2 (“Reconsideration”), Bankruptcy
Case No. 19-489, ECF No. 53. 1 This sale was ratified by the D.C. Superior Court on March 25,
2018, and Reliance took title to the property on March 26, 2018. Id. Reliance then filed a
Complaint for Possession in D.C. Superior Court, pursuant to which it received a judgment for
possession in its favor on May 15, 2019. Id. Ms. Owens filed for Chapter 11 bankruptcy before
Judge Teel in the D.C. Bankruptcy Court on July 19, 2019, the day of her scheduled eviction,
which prompted the entry of an automatic stay under 11 U.S.C. § 362. Id. That same day, Ms.
Owens also filed to remove the possession case to federal court, although the case was quickly
remanded back to Superior Court. 2 Appellee Br. at 4–5, ECF No. 11. As a result of all this, Ms.
Owens’s eviction was temporarily stayed, but a status conference on the eviction was scheduled
in Superior Court for August 2. Id. Ex. 4, ECF No. 11-1.
In response, Reliance filed a motion before the Bankruptcy Court to lift the automatic
stay to allow the eviction to proceed, to shorten the time Ms. Owens had to respond to its motion,
and to bar Ms. Owens from future filings. See Emerg. Mot. for Decl. Order Stating Reliance’s J.
is Not Subject to the Auto. Bankr. Stay, Mot. to Shorten the Time to Resp. to this Mot., and Mot.
1
The facts and procedural history recounted here are drawn from the record on appeal,
ECF No. 5. Certain filings and orders were not included in full in the record; in these cases, the
Court has cited to the full versions available on the Bankruptcy Court docket. Under Bankruptcy
Rule 8009, the appellant generally has the responsibility to designate the items to be included in
the record before transmittal. See Fed. R. Bankr. P. 8009(a)(1)(A). The contents of the record
here are incomplete. But this is understandable, given that Ms. Owens’s initial notice of appeal
only challenged the orders of July 29 and August 1, but her amended notice of appeal and her
briefing challenge several subsequent orders of the Bankruptcy Court, discussed infra. As Ms.
Owens is appealing pro se, the Court will take judicial notice of items not included in the record
to avoid further delay in deciding this appeal on the merits. See Frostbaum v. Ochs, 277 B.R.
470, 473 n.1 (E.D.N.Y. May 16, 2002) (finding it appropriate, “[i]n light of Apellant’s pro se
status on this appeal,” to obtain a copy of a challenged order “in order to avoid requests for
additional time or to refile the appeal”).
2
Specifically, Ms. Owens’s removal of the eviction proceeding was rejected by the
District Court on July 24, 2019 and the proceeding was remanded back to the Superior Court.
Appellee Br. Ex. 5, ECF No. 11-1.
2
to Enjoin Owens From Future Filings (“Emergency Motion”), Bankruptcy Case No. 19-489,
ECF No. 21. Judge Teel granted Reliance’s motion to shorten the time for response on July 29.
See Order Granting Mot. to Shorten Time (“Shorten Order”), Bankruptcy Case No. 19-489, ECF
No. 27. He also set a hearing date for August 1 to determine whether to grant Reliance’s two
other requests contained within the Emergency Motion: the request for relief from the automatic
stay, and the request for an injunction to prevent further filings. Id. at 2–3. After the August 1
hearing, the Bankruptcy Court granted Reliance’s emergency motion granting relief from the
stay. See Order Granting Relief from the Automatic Stay to Permit Eviction Action to Proceed
(“Stay Relief”), Bankruptcy Case No. 19-489, ECF No. 31. The court also denied Ms. Owens’s
motion for a continuance, which she had filed that same morning. See Order Re Mot. for
Continuance of Hr’g, Bankruptcy Case No. 19-489, ECF No. 32. After the Status Conference on
August 2, the Superior Court granted Reliance’s request to proceed with the eviction. Appellee
Br. 5.
Ms. Owens’s bankruptcy petition was dismissed on August 6, for failure to timely file a
proper mailing matrix 3 and failure to pay the filing fee or obtain leave to pay the fee in
installments. See Order Dismissing Case (“Dismissal”) at 1–2, Bankruptcy Case No. 19-489,
ECF No. 44. (Judge Teel had dismissed Ms. Owens’s petition initially on August 1, 2019 for
failure to file a proper mailing matrix, but vacated that dismissal on the grounds that it was
issued prematurely and mistakenly, as the August 2, 2019 deadline to show cause regarding the
3
Bankruptcy Rule 1007 includes a requirement to file a mailing matrix, or list of
creditors, in a chapter 11 case. See Fed. R. Bankr. P. 1007; see also 11 U.S.C. § 521(a)(1)(A).
Local Rule 1007-1 requires a coversheet to be filed by the debtor, which must contain a
declaration as to its accuracy. LBR 1007-1(b). These requirements serve as a key to efficient
resolution of a bankruptcy case and failure to satisfy them are grounds for dismissal. See In re
Wilcox, 463 B.R. 143 (B.A.P. 10th Cir. 2011).
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failure to file the mailing matrix had not yet been passed. See Order Vacating Order Dismissing
Case at 1, Bankruptcy Case No. 19-489, ECF No. 43.)
On August 9, 2020, Ms. Owens filed a notice of appeal, appealing “All Orders,
Judgments, or Decrees on July 29 and August 1, 2019.” See Notice of Appeal at 3, ECF No. 1.
However, proceedings continued. On August 19, the Bankruptcy Court denied a motion to
reconsider, wherein Ms. Owens had sought to reinstate the automatic stay. Reconsideration at 1.
On August 26, 2019, Ms. Owens filed an amended notice of appeal, indicating she was more
broadly challenging “All orders, judgments, and decrees from July 19, 2019 thru present,
including 7-26-19, 8-1-19, 8-6-19, and hereafter.” Amended Notice of Appeal, ECF No. 3. On
August 29, after an oral hearing, the Bankruptcy Court granted Reliance’s Motion to Enjoin
Future Filings, thus preventing Owens from making any future bankruptcy filings under which
an automatic stay would arise and frustrate Reliance’s attempts to take possession of the
property. See Order (“Prospective Relief”) at 3, Bankruptcy Case No. 19-489, ECF No. 61. In
its briefing before this Court, Reliance represents that Ms. Owens was evicted from the property
on August 30, 2019. Appellee Br. at 5.
Ms. Owens, in her brief, asks this Court to “vacate all the decisions of the Bankruptcy
court.” Appellant Br. at 1, ECF No. 8. As a result, and consistent with the amended notice of
appeal, this Court understands Ms. Owens to be appealing the following orders of the
Bankruptcy Court: (1) the July 29 order shortening the time Ms. Owens had to respond to
Reliance’s emergency motion; (2) the August 1 order granting Reliance’s motion and thus relief
from the automatic stay; (3) the August 1 order denying Ms. Owens’s motion to continue the
hearing; (4) the August 6 order dismissing Ms. Owens’s petition (which superseded the vacated
decision that dismissed Ms. Owens’s petition); (5) the August 19 order denying reconsideration
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of dismissal; and (6) the August 29 order temporarily enjoining Ms. Owens from future
bankruptcy filings and granting prospective relief from any automatic stay.
III. LEGAL FRAMEWORK
A. Jurisdictional Issues
District courts have jurisdiction to hear appeals of the judgments, final orders, and
decrees of bankruptcy courts. 28 U.S.C. § 158(a). This section further provides that such
appeals “shall be taken in the same manner as appeals in civil proceedings generally are taken to
the courts of appeals from the district courts and in the time provided by Rule 8002 of the
Bankruptcy Rules.” Id. § 158(c)(2).
The Court has jurisdiction to consider each of the appealed orders. Two of the orders
appealed by Ms. Owens are clearly final: the order dismissing her petition and the order lifting
the automatic stay. See Ritzen Grp., Inc. v. Jackson Masonry, LLC, 140 S. Ct. 582, 586–87
(2020) (holding that adjudication of an order to grant relief from the automatic stay is a final,
appealable order, while also noting generally that “[o]rders in bankruptcy cases qualify as ‘final’
when they definitively dispose of discrete disputes within the overarching bankruptcy case”)
(citing Bullard v. Blue Hills Bank, 575 U.S. 496, 501 (2015)). The remaining orders—best
characterized as interlocutory—are reviewable here because they merge into the order dismissing
the petition. See In re Urban Broad. Corp., 304 B.R. 263, 270 n.15 (E.D. Va. 2004) (“We note
further that the dismissal of the bankruptcy petition is a final judgment, and all interlocutory
orders merge into that judgment; that is, [appellant] in appealing the dismissal may appeal any
interlocutory orders that underlie it as well.”) (quoting In re Dunes Hotel Assoc., 1998 WL
416742, at *3 (4th Cir. July 22, 1998)).
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B. Mootness
Mootness, both under constitutional and equitable grounds, must be considered on appeal
from Bankruptcy Courts. See In re Carvalho, 598 B.R. 356, 360 (D.D.C. 2019) (“[I]f an event
occurs while a case is pending on appeal that makes it impossible for the court to grant any
effectual relief whatever to a prevailing party, the appeal must be dismissed, for federal courts
have no authority to give opinions upon moot questions or abstract propositions, or to declare
principles or rules of law which cannot affect the matter in issue in the case before it.”) (internal
quotation marks omitted) (quoting Church of Scientology of Calif. v. United States, 506 U.S. 9,
12 (1992)). In such a circumstance mootness occurs in a constitutional sense, id., but equitable
mootness may also occur when the granting of conceivably effective relief would be inequitable,
see In re Hardy, 589 B.R. 217, 221 (D.D.C. 2018) (holding that the appeal of a property sale to a
good faith purchaser in a bankruptcy proceeding was moot because such a sale was not stayed
pending appeal); see also In re AOV Indus., Inc., 792 F.2d 1140, 1147–48 (D.C. Cir. 1986).
C. Standard of Review
A district court reviews the Bankruptcy Court’s findings of fact for clear error, while
conclusions of law are reviewed de novo. See Hope 7 Monroe St. Ltd. P’ship v. RIASO L.L.C.,
473 B.R. 1, 6 (D.D.C. 2012), aff’d sub nom. In re Hope 7 Monroe St. Ltd. P’ship, 743 F.3d 867
(D.C. Cir. 2014). Appellant holds the burden of proof and to prevail “must show that the court's
holding was clearly erroneous as to the assessment of the facts or erroneous in its interpretation
of the law and not simply that another conclusion could have been reached.” Alberts v. HCA,
Inc., 496 B.R. 1, 9 (D.D.C. 2013) (quoting In re Johnson, 236 B.R. 510, 518 (D.D.C. 1999)).
Finally, equitable and discretionary decisions of the Bankruptcy Court are reviewed under an
abuse of discretion standard. See In re Capitol Hill Grp., 313 B.R. 344, 349 (D.D.C. 2004)
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(citing In re Behlke, 358 F.3d 429, 433 (6th Cir. 2004); In re I. Appel Corp., 300 B.R. 564
(S.D.N.Y. 2003)).
IV. ANALYSIS
The Court will analyze each of the challenged orders in turn.
A. Order Granting Motion to Shorten Time to Respond to Reliance’s Emergency Motion
Ms. Owens appeals Judge Teel’s decision on July 29, 2019 to shorten the time frame to
respond to Reliance’s emergency motion and setting a hearing date for August 1. See Appellant
Br. at 2–3. Ms. Owens asserts that she was not able to adequately prepare for the August 1
hearing on such short notice. Id. Bankruptcy Rule 9006 allows Bankruptcy Courts the ability to
shorten such a time interval with or without motion, noting that the decision is a discretionary
one. Fed. R. Bankr. P. 9006(c)(1). Although Judge Teel clearly lays out the grounds on which
he has granted the motion and his reasoning for setting the August 1 hearing, see Shorten Order
at 2, this Court will not review such reasoning for abuse of discretion, as appeal of this order is
moot. Ms. Owens was evicted from the property on August 30, 2019. The Court cannot grant
her requested relief, the return of the property, as Ms. Owens held no interest in the property
during the entirety of the bankruptcy proceeding outside of (potentially) a possessory one. See
Reconsideration at 6–7. Granting this relief, given the result of her eviction as an intervening
event, not only presents a constitutional mootness issue but also an equitable one, as granting
such relief would require reversing a long history of state eviction and foreclosure proceedings. 4
See, e.g., In Re Carvalho, 598 B.R. at 360; In Re Hardy, 589 B.R. at 221.
4
To the extent that Appellant is using this appeal as a vehicle to return her property and
reverse the Superior Court decision, see Appellant Br. at 16 (asking the court to “repair the
damages by returning my property”), the Rooker-Feldman doctrine would likely preclude such
relief. The Rooker-Feldman doctrine, as recognized in this circumstance both by Judge Teel and
Judge Berman-Jackson in her remand order of a related case involving Ms. Owens, Reliance
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B. Order Granting Relief from Automatic Stay Under 11 U.S.C. § 362
Ms. Owens’s appeal of Judge Teel’s order granting relief from the automatic stay is also
moot for similar reasons. Ms. Owens correctly asserts that upon the filing of Chapter 11
bankruptcy, a stay automatically issues against several different types of proceedings,
enforcement, and collection actions. See 11 U.S.C. §362(a)(1)–(8). However, courts can grant
relief from an automatic stay upon motion. Fed. R. Bankr. P. 4001; see 11 U.S.C. § 362(d).
While Judge Teel’s order appears amply justified, the Court will again not evaluate the adequacy
of that decision, as appeal of this order is moot. The automatic stay was lifted upon dismissal of
Ms. Owens’s petition on August 6, after which Ms. Owens was evicted from the property. While
the lifting of the stay allowed the Superior Court to move forward with the eviction proceeding at
the status conference on August 2, the stay would have been lifted at the latest on August 6 with
the dismissal of the case. See 11 U.S.C. 362(c)(2)(B); see also In re Foreman, 278 B.R. 92, 95
(D. Md. 2002) (holding that an order of relief of an automatic stay with subsequent eviction
moots the appeal of that order).
C. Order Denying Motion to Continue Hearing
Similarly, Ms. Owens’s appeal of the denial of her motion to continue is moot. Even if
this Court assumes that granting the requested continuance would have allowed Ms. Owens more
time to sufficiently plead her case as to why Reliance should not be granted relief from the
automatic stay, Judge Teel noted that he was bound by the Superior Court ruling as to Ms.
Owens’s lack of ownership interest in the property. Order Re Mot. for Continuance of Hr’g at 2.
Furthermore, Ms. Owens’s appeal of this order is rendered moot by the dismissal of her case on
Group LLC v. Owens, No. 19-cv-2050, precludes federal courts from exercising jurisdiction over
claims which were ultimately unsuccessful in state court. See D.C. Court of Appeals v. Feldman,
460 U.S. 462 (1983); Rooker v. Fidelity Trust Co., 263 U.S. 413 (1923).
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August 6, which lifted the automatic stay and would have allowed the eviction to proceed
regardless of any grant of a continuance.
D. Order Dismissing Case
On August 6, 2019, Ms. Owens’s bankruptcy petition was dismissed for failure to file a
proper mailing matrix and failure to pay the filing fee or obtain leave to pay the fee in
installments. Dismissal at 1–2. Appellant asserts that her petition for bankruptcy met all
applicable legal requirements, that her mailing matrix was properly filed, and that her case
should not have been dismissed as she filed an application to pay the filing fees in installments in
accordance with Bankruptcy Rule 1006. Appellant Br. at 12. However, on July 19, 2019, Ms.
Owens was ordered to either pay the filing fee in full, show cause as to why she should be able to
pay in installments, or show cause as to why her case should not be rejected for failure to pay the
fee in full. See Dismissal at 1. A similar order was issued for her failure to meet the
requirements of a verified mailing matrix. Id. at 1–2. Judge Teel’s factual findings that Ms.
Owens failed to adequately pay the filing fee or file an appropriate mailing matrix are reviewed
for clear error. See Alberts, 496 B.R. at 9; Hope 7 Monroe St., 473 B.R. at 6. Despite
Appellant’s assertions to the contrary that she met the applicable legal requirements, Appellant
Br. at 12, Judge Teel adequately laid out his findings and in doing so did not clearly err, see
Dismissal at 1–2. Furthermore, the ultimate decision to dismiss the case for failure to pay the
filing fee is a discretionary one and, in applying that standard to these facts (particularly in light
of Ms. Owens’s failure to respond to the orders to show cause), Judge Teel did not abuse his
discretion. See Fed. R. Bankr. P. 1017(b)(1) (the court “may” dismiss the case) (emphasis
added). Accordingly, the dismissal of Appellant’s case is affirmed.
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E. Order Denying Motion to Reconsider Dismissal
On August 3, 2019, Ms. Owens filed a motion to vacate the order lifting the stay,
rejecting her continuance, and dismissing her case. See Expedited Motion to Vacate Order,
Bankruptcy Case No. 19-489, ECF No. 41. Judge Teel issued his memorandum opinion denying
the motion on August 19, 2019. See Reconsideration at 1. In his opinion, Judge Teel properly
applies the applicable standard of review, as indicated in Rule 9023. See Fed. R. Bankr. P. 9023
(applying Fed. R. Civ. P. 59(e) to motions to alter or amend a judgment). Decisions refusing to
vacate a judgment under Rule 59(e) are reviewed for abuse of discretion. See Osborn v. Visa
Inc., 797 F.3d 1057, 1063 (D.C. Cir. 2015) (citing Firestone v. Firestone, 76 F.3d 1205, 1208
(D.C. Cir. 1996)). Judge Teel considered all the arguments offered by Ms. Owens, which, as he
noted, are substantially a rehashing of the arguments she made in her previous motions. See
Reconsideration at 4. Judge Teel properly weighed an asserted “intervening change of
controlling law” and determined it inapplicable. Reconsideration at 6–7; see Firestone, 76 F.3d
at 1208. As such, Judge Teel did not abuse his discretion in denying the motion and his decision
is affirmed.
F. Order Enjoining Future Filings and Granting in Prospective Relief from Automatic
Stay
On August 29, 2019, reflecting decisions rendered at an August 20 oral hearing, the
Bankruptcy Court granted the last request remaining from Reliance’s emergency motion: the
motion to enjoin Ms. Owens from future filings. See Prospective Relief at 3. In this order, Judge
Teel also granted prospective relief from any automatic stay that would arise upon Ms. Owens
filing another bankruptcy petition and applied such relief in rem 5 to the property. Id. The order
5
Although the prospective order stated it applied to the property “in rem,” it made clear
that prospective relief was limited to Ms. Owens. See Prospective Relief at 3 (“[The] August 1,
2019 Order terminating the automatic stay shall apply to and be binding upon the Property,
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specified that it would “stay in effect until Reliance obtains possession of the Property from
Debtor.” Id.
In reference to this order, Ms. Owens asserts that there “is no law or bankruptcy rule that
allows a Bankruptcy Court to attach a lien or conditions of bankruptcy to an estate, particularly
at a hearing held after it has dismissed the bankruptcy case.” Appellant Br. at 16. However,
“bankruptcy courts retain jurisdiction over certain matters after dismissal or closing of a
bankruptcy case.” In re Commercial Fin. Servs., Inc., 247 B.R. 828, 844 (Bankr. N.D. Okla.
2000). As relevant here, they “inherently have the power to enforce their own orders, regardless
of whether a case is open or closed.” Id. The specific authority to enjoin future bankruptcy
filings is recognized to derive from section 105 of Title 11. See 11 U.S.C. § 105(a) (“The court
may issue any order, process, or judgment that is necessary or appropriate to carry out the
provisions of this title.”); see also In re Casse, 198 F.3d 327, 336 (2d Cir. 1999) (noting that “§
105 empowers [the bankruptcy court] to enjoin future filings to prevent abuse of the bankruptcy
process.”) (quoting In re Earl, 140 B.R. 728, 741 n.4 (Bankr. N.D. Ind. 1992)) (internal
quotation marks omitted).
As both the enjoinment of future filings and the prospective relief are discretionary
decisions, this Court reviews them for abuse of discretion. See In re Sindram, 464 B.R. 495, 497
(D.D.C. 2011). Based on Judge Teel’s conclusions that Reliance did, in fact, own the property in
question and the several factual findings regarding the dilatory and bad faith filings of Ms.
Owens, Prospective Relief at 2, the Court concludes that Judge Teel did not abuse his discretion
in enjoining future bankruptcy filings and awarding prospective relief. The relief was limited in
granting prospective in rem relief from any bankruptcy stay, whether § 362 or § 1301 of the
United States Bankruptcy Code, in all future bankruptcies filed by Debtor[.]”) (emphasis added).
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duration and scope and tailored to give effect to the Bankruptcy Court’s earlier order lifting the
automatic stay.
V. CONCLUSION
For the foregoing reasons, Appellant’s appeal from the Bankruptcy Court is
DISMISSED.6 An order consistent with this Memorandum Opinion is separately and
contemporaneously issued.
Dated: April 20, 2020 RUDOLPH CONTRERAS
United States District Judge
6
On February 21, 2020, Appellant filed an untimely motion for an extension of time to
reply to Appellee’s brief. See Mot. for Extension of Time, ECF No. 13. The ability to grant an
extension under Rule 6(b)(1) is discretionary and is granted upon a showing of good cause.
Cooper v. United States Dep’t of Justice, 169 F. Supp. 3d 20, 45 (D.D.C. 2016). Because
Appellant has not shown good cause as to why she should be granted an extension, because her
reasoning previewed in her motion for extension is substantially a rehashing of arguments raised
elsewhere, and because a reply brief is not required for this Court to sufficiently decide this case
on the merits, her request is denied. Additionally, because this appeal will be dismissed, her
renewed motion for CM/ECF access is also denied as moot. See Second Mot. for CM/ECF
Password, ECF No. 12.
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