Banks v. Fox (In Re Banks)

Opinions of the United
2007 Decisions States Court of Appeals
for the Third Circuit
6-8-2007
In Re: Banks
Precedential or Non-Precedential: Non-Precedential
Docket No. 06-1849
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"In Re: Banks " (2007). 2007 Decisions. Paper 977.
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DLD-242 NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
________________
No. 06-1849
________________
IN RE: FREDERICK H. BANKS,
Debtor
FREDERICK H. BANKS,
Appellant
v.
BARRY FOX; BARRY FOX
AND ASSOCIATES INC.
________________
On Appeal From the United States District Court
For the Western District of Pennsylvania
(D.C. Civ. No. 05-cv-00614)
District Judge: Honorable Joy Flowers Conti
________________
Submitted For Possible Dismissal Under 28 U.S.C. § 1915(e)(2)(B) or Summary Action
Under Third Circuit LAR 27.4 and I.O.P. 10.6
May 24, 2007
Before: BARRY, AMBRO and FISHER, Circuit Judges
(Filed June 8, 2007)
________________
OPINION
________________
PER CURIAM
On November 1, 2001, Frederick H. Banks filed for bankruptcy protection under
Chapter 7 of the Bankruptcy Code. The appointed trustee in bankruptcy filed a report of
no assets. In 2005, Banks instituted many adversary actions, including the one at issue in
this appeal. The Bankruptcy Court, holding that it lacked subject-matter jurisdiction over
the adversary actions because they related only to post-petition acts unrelated to the
administration of Banks’ bankruptcy case, dismissed them. Banks appealed to the
District Court. The District Court affirmed the order dismissing the adversary actions.
Banks appeals.
The District Court had jurisdiction to review the Bankruptcy Court’s order
pursuant to 28 U.S.C. § 158(a), and we have jurisdiction to review the District Court’s
order under 28 U.S.C. §§ 158(d) & 1291. We exercise the same standard of review as the
District Court, subjecting the Bankruptcy Court’s legal determinations to plenary review
and reviewing its factual findings for clear error. See In re United Healthcare Sys., 396
F.3d 247, 249 (3d Cir. 2005).
In similar appeals brought by Banks, we have visited the issues relevant to this
case. As in those other cases, we will summarily affirm because no substantial question
is presented on appeal. See L.A.R. 27.4; I.O.P. 10.6. We repeat the reasoning most
pertinent to our decision.
The Bankruptcy Court lacked subject-matter jurisdiction over the listed adversary
action.1 Two statutes, 28 U.S.C. §§ 1334 and 157, provide the source of a bankruptcy
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Although Banks took issue in the District Court with the Bankruptcy Court’s action to
dismiss his adversary actions sua sponte, as the District Court explained, the Bankruptcy
Court was obligated to evaluate its jurisdiction and dismiss the actions over which it
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court’s jurisdiction. See Binder v. Price Waterhouse & Co., 372 F.3d 154, 161 (3d Cir.
2004). Under these statutes, and relevant to our analysis here, a bankruptcy court has
jurisdiction over those cases “‘at least “related to” the bankruptcy.’” In re Marcus Hook
Dev. Park, Inc., 943 F.2d 261, 266 (3d Cir. 1991) (citations omitted). Litigation is related
to a bankruptcy if its outcome could “conceivably have any effect on the estate being
administrated in bankruptcy.” See Pacor, Inc. v. Higgins, 743 F.2d 984, 994 (3d Cir.
1984); see also In re Marcus Hook Dev. Park, Inc., 943 F.2d at 264 (stressing the term
“conceivably”). More specifically, an action is related to bankruptcy if its outcome
“could alter the debtor’s rights, liabilities, options, or freedom of action (either positively
or negatively) and which in any way impacts upon the handling and administration of the
bankruptcy estate.” See Pacor, 743 F.2d at 994. The listed adversary action was
unrelated to bankruptcy because, as Banks plainly alleged in his complaint, the supposed
wrongs occurred in February 2003 and beyond, after he had filed for bankruptcy
protection. Accordingly, his claims are not property of the bankruptcy estate such that
their resolution would affect the handling or administration of the estate. See In re
Bobroff, 766 F.2d 797, 803 (3d Cir. 1985) (citing 11 U.S.C. § 541 for the proposition that
“the only property interests of a debtor that become part of the estate are those existing
‘as of the commencement of the case.’”)
In sum, because the Bankruptcy Court lacked subject-matter jurisdiction, we will
affirm the order insomuch as it dismissed the listed adversary action.
lacked jurisdiction.
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