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Bankruptcy

By: Derek Hawkins//August 17, 2016//

Bankruptcy

By: Derek Hawkins//August 17, 2016//

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7th Circuit Court of Appeals

Case Name: BCL Sheffield, LLC et al v. Gemini Int’l, Inc., et al

Case No.: 16-1083

Officials: POSNER, MANION, and ROVNER, Circuit Judges

Focus: Bankruptcy

Bankruptcy order regarding estate entitlement to assets was valid

“The defendants base their appeal on the aforecited 28 U.S.C. § 157(c)(1), which states that “a bankruptcy judge may hear a proceeding that is not a core proceeding but that is otherwise related to a case under title 11. In such proceeding, the bankruptcy judge shall submit proposed findings of fact and conclusions of law to the district court, and any final order or judgment shall be entered by the district judge after considering the bankruptcy judge’s proposed findings and conclusions and after reviewing de novo those matters to which any party has timely and specifically objected.” The defendants argue that the plaintiffs’ turnover claim is not a “core proceeding” and so only the district court may enter a final order resolving the claim. Core proceedings are proceedings under bankruptcy law; non‐core proceedings are proceedings that relate to a bankruptcy but arise under some other body of law. The turnover of the defendants’ assets to the debtor’s estate, and the liquidation of the assets for the benefit of the defendants, is a core proceeding, see 28 U.S.C. § 157(b)(2)(E), based therefore on bankruptcy law, and so the limitations on the bankruptcy court’s authority that are imposed by section 157(c)(1) are irrelevant, because those limitations are applicable only to a bankruptcy court’s administration of non‐core proceedings.

Appeal dismissed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.

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