Jeff Tucker v. Barry E. Mukamal

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
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No. 15-10684
Non-Argument Calendar
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D.C. Docket No. 1:13-mc-23425-KAM
JEFF TUCKER,
Plaintiff - Appellant,
versus
BARRY E. MUKAMAL,
Defendant - Appellee.
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Appeal from the United States District Court
for the Southern District of Florida
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(September 4, 2015)
Before MARCUS, WILLIAM PRYOR and JILL PRYOR, Circuit Judges.
PER CURIAM:
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Jeff Tucker appeals an order the district court entered in its role as
bankruptcy appellate court affirming the bankruptcy court’s denial of a motion to
recuse and grant of a motion to conclude administration of the bankruptcy case.
After careful review, we affirm.
I.
Mr. Tucker filed a Chapter 7 bankruptcy petition in 2004, and the
bankruptcy court appointed appellee Barry Mukamal as Trustee. Two years later,
Mr. Tucker and the Trustee entered into a court-approved settlement agreement
which set forth payments Mr. Tucker was required to make by November 20, 2007
to settle certain debts against his estate in exchange for his discharge in
bankruptcy. The agreement provided that, if Mr. Tucker defaulted on his
obligations, the Trustee was entitled to exercise certain remedies, including (as
relevant here) revocation of the bankruptcy discharge.
Mr. Tucker subsequently defaulted on his obligations under the settlement
agreement by failing to timely settle the debts against his estate, so the Trustee
moved in 2011 to revoke the bankruptcy discharge. After a hearing, the
bankruptcy court granted the motion. Shortly thereafter, Mr. Tucker filed a motion
for recusal of the bankruptcy judge, which was denied.
Almost two years later, the Trustee filed a “Motion to Conclude
Administration of Chapter 7 Case” (the “Trustee’s Motion”). The Trustee noted
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that one claim against the now insolvent bankruptcy estate remained outstanding
and was the subject of an ongoing adversary proceeding between Mr. Tucker and a
purported creditor (a proceeding to which the Trustee was not a party). Citing the
near ten-year span of litigation and emphasizing that the adversary proceeding
could continue for some time without a resolution, the Trustee requested that the
bankruptcy court close the case subject to any distributions that may later occur as
a result of the resolution of the adversary proceeding and its impact on the single
outstanding claim against the estate.
Although Mr. Tucker filed a response in opposition to the Trustee’s Motion,
he stated in his response that his objection was to the Trustee’s previous record of
“sitting on his hands” and neglecting “his statutory duty to close the case in an
expeditious manner.” Response in Opposition to Trustee’s Motion, Doc. 661 at 1-
2, In re Tucker, No. 1:04-bk-13319-AJC (Bankr. S.D. Fla. Aug. 1, 2013). Mr.
Tucker expressed frustration that the Trustee had “dragg[ed] the case on for three
years after the sole creditor and Jeff Tucker requested the case be closed.” Id. at 2.
He also stated that the Trustee “had absolute statutory authority to close the case
since September 15, 2010, when both the sole creditor and Jeff Tucker requested
[that Trustee] Mukamal close the case.” Id. at 3. The bankruptcy court, noting the
apparent agreement between the parties, granted the Trustee’s Motion and directed
the Trustee to close the case.
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Mr. Tucker appealed the bankruptcy court’s denial of his motion to recuse
and decision ordering closure of the case to the district court, which affirmed both
orders. With respect to the recusal motion, the district court found that the
bankruptcy judge’s expressions of his opinion of Mr. Tucker’s credibility were
influenced by Mr. Tucker’s conduct, including his default on the settlement
agreement. Because the bankruptcy judge’s comments were grounded in his
experience overseeing the proceedings, the district court reasoned, the denial of the
motion to recuse did not amount to an abuse of discretion. With respect to the
bankruptcy court’s decision to grant the Trustee’s Motion, the district court found
that Mr. Tucker lacked standing to challenge that order because, since the estate
was deficient, he would not receive a distribution from it and therefore no longer
had a financial stake in the outcome of the proceedings. Mr. Tucker now appeals
from the district court’s order affirming both decisions.
II.
“In a bankruptcy case, this Court sits as a second court of review and thus
examines independently the factual and legal determinations of the bankruptcy
court and employs the same standards of review as the district court.” Brown v.
Gore (In re Brown), 742 F.3d 1309, 1315 (11th Cir. 2014) (internal quotation
marks omitted). We review the denial of a motion for recusal for an abuse of
discretion and will reverse only if the judge who decides not to recuse made “a
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clear error of judgment.” United States v. Kelly, 888 F.2d 732, 744-45 (11th Cir.
1989). We otherwise generally review a bankruptcy court’s factual findings for
clear error and its legal conclusions de novo. Fisher Island Ltd. v. Solby+Westbrae
Partners (In re Fisher Island Invs., Inc.), 778 F.3d 1172, 1189 (11th Cir. 2015).
III.
A.
We first address whether the bankruptcy court abused its discretion in
denying Mr. Tucker’s motion to recuse. Federal law requires a judge to recuse
when his “impartiality might reasonably be questioned.” 28 U.S.C. § 455(a). A
court ruling on a recusal motion under § 455(a) must decide “whether an objective,
disinterested, lay observer fully informed of the facts underlying the grounds on
which recusal was sought would entertain a significant doubt about the judge’s
impartiality.” Parker v. Connors Steel Co., 855 F.2d 1510, 1524 (11th Cir.1988).
A judge is not “recusable for bias or prejudice [when] his knowledge and the
opinion it produced were properly and necessarily acquired in the course of the
proceedings.” Liteky v. United States, 510 U.S. 540, 551 (1994).
Over the course of almost a decade of litigation in this case, the bankruptcy
judge made half a dozen or so comments about Mr. Tucker’s demeanor and
litigation strategy that Mr. Tucker now argues illustrated personal bias. These few
comments, made based on what the bankruptcy court observed in court, do not,
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however, reflect “a deep-seated favoritism or antagonism that would make fair
judgment impossible.” Id. at 555. Indeed, “expressions of impatience,
dissatisfaction, annoyance, and even anger,” such as those the bankruptcy judge
occasionally made in this case, “are within the bounds of what imperfect men and
women, even after having been confirmed as federal judges, sometimes display.”
Id. at 555-56.
The bankruptcy judge’s comments, although undoubtedly reflective of his
annoyance with Mr. Tucker, were based on his interactions with Mr. Tucker, the
Trustee, and counsel throughout the proceedings. Without more, these comments
are insufficient to demonstrate to us the kind of favoritism or antagonism that
would make recusal necessary. We therefore conclude that the bankruptcy court’s
decision to deny Mr. Tucker’s recusal motion was not a clear error of judgment
and affirm the district court’s decision to uphold the bankruptcy court’s order.
B.
We turn now to Mr. Tucker’s contention that the bankruptcy court
erroneously ordered his case closed. The district court found that Mr. Tucker was
not aggrieved by the order granting the Trustee’s Motion because he had no
remaining financial stake in the proceedings and accordingly lacked standing to
challenge the bankruptcy court’s decision. Mr. Tucker argues that the district
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court’s conclusion regarding standing was wrong and that the bankruptcy court
should not have ordered the caser closed.
We agree with the district court that the bankruptcy court did not err in
granting the Trustee’s Motion. Only a “person aggrieved” may appeal a
bankruptcy order, and our precedent has limited persons aggrieved to those with “a
financial stake in the order being appealed,” that is, those who are “directly,
adversely, and pecuniarily affect[ed]” by the order. Westwood Cmty. Two Ass’n v.
Barbee (In re Westwood Cmty. Two Ass’n), 293 F.3d 1332, 1335, 1337-38 (11th
Cir. 2002). “A person has a financial stake in the order when that order diminishes
[his] property, increases [his] burdens[,] or impairs [his] rights.” Id. at 1335
(internal quotation marks omitted).
Here, Mr. Tucker does not dispute that the estate is deficient and as a result
he will receive no distribution from the underlying bankruptcy proceeding. Thus,
he was not directly pecuniarily affected by the bankruptcy court’s decision to order
the administration of the estate’s proceedings closed. As regards his contention
that he has standing because his ongoing adversary proceeding ultimately might
have affected his financial stake in the outcome of the underlying bankruptcy
proceeding, this argument is foreclosed by our precedent. See Atkinson v. Ernie
Haire Ford, Inc. (In re Ernie Haire Ford, Inc.), 764 F.3d 1321, 1325-26 (11th Cir.
2014) (“[A] party is not aggrieved, for the purposes of appealing from a
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bankruptcy court order, when the only interest allegedly harmed by that order is
the interest in avoiding liability from an adversary proceeding.”). Moreover, we
reject Mr. Tucker’s argument that other outstanding issues, such as whether the
court might impose sanctions, gave him a financial stake in the outcome of the
bankruptcy case’s administration. Those interests—which the Bankruptcy Code
does not specifically “seek[] to protect or regulate”—are insufficient to confer
standing. See id. at 1326.
In any event, even if Mr. Tucker had standing to challenge the bankruptcy
court’s order on the Trustee’s Motion, we note he conceded before the bankruptcy
court that the Trustee had “absolute statutory authority” to close the case and
agreed that the case was due to be closed. He therefore has waived any argument
to the contrary. See Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523, 1529
(2013) (emphasizing that, where a party concedes a point before a lower court that
he does not genuinely contest on appeal, his waiver will “prevent us from reaching
it”). The district court accordingly did not err in affirming the bankruptcy court’s
decision to grant the Trustee’s Motion.
IV.
For the foregoing reasons, we affirm the district court’s order upholding the
bankruptcy court’s denial of Mr. Tucker’s motion to recuse and closure of the
bankruptcy case.
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AFFIRMED.
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