Coudert Brothers LLP v. Varanese
- Kenneth Karas
- 7:17-cv-03619
- U.S. District Court · Southern District of New York
- 4
In Development Specialists v. Varanese, Judge Karas adopted bankruptcy-court findings and directed judgment for the plan administrator after Varanese did not respond.
Development Specialists, Inc., as Coudert Brothers LLP’s plan administrator, received judgment pursuant to the adopted proposed findings. James B. Varanese was affected by the judgment and had not appeared or objected in the action.
What happened
Development Specialists, Inc., acting as Coudert Brothers LLP’s plan administrator, sought to enforce contractual obligations against former partner James B. Varanese. An arbitrator had issued a final award determining the damages Varanese owed, and the bankruptcy court recommended findings supporting judgment for Development Specialists.
The district court addressed service and found that Development Specialists had properly served the relevant documents. Varanese did not appear, respond, or object to the bankruptcy judge’s proposed findings within the required period, so he waived his right to object.
Judge Kenneth M. Karas independently reviewed the proposed findings, found no error, and adopted them in full. The court directed the Clerk to enter judgment for Development Specialists, ordered the case closed, and required additional mailing of the order to Varanese.
The detailed version
- Coudert Brothers LLP v. Varanese · No. 7:17-cv-03619
- Kenneth Karas
- July 9, 2020
Background
Coudert Brothers LLP dissolved and entered bankruptcy. Development Specialists, Inc., acting as Coudert’s plan administrator, brought adversary actions against several former law partners, including James B. Varanese, to enforce contractual obligations. An arbitrator later issued a final award determining the damages Varanese owed Development Specialists. Development Specialists moved in bankruptcy court to confirm the award.
Bankruptcy Judge Robert D. Drain issued proposed findings of fact and conclusions of law in the non-core proceeding. The district court later addressed problems involving service. It concluded that, under Federal Rule of Civil Procedure 4(f), Varanese could be served at his known addresses and gave Development Specialists 30 days to do so. Development Specialists filed certificates stating that it had completed service in accordance with the court’s orders.
Failure to Respond
After granting Varanese’s requests for extensions to properly serve Development Specialists, the court issued an order requiring Varanese to explain why it should not adopt Judge Drain’s proposed findings or, at minimum, to request an opportunity to brief the issue. Development Specialists served that order, and the Clerk separately mailed it to Varanese’s address on record. Varanese did not appear in the action and did not file objections or an intent to object by the deadline.
The court explained that a district court generally reviews proposed findings in a non-core bankruptcy proceeding from the beginning when a party makes a specific, timely written objection. Because Varanese made no objection or request to object, the court held that he waived his right to object to Judge Drain’s proposed findings.
Ruling
The court also independently reviewed Judge Drain’s proposed findings and found no error in the factual findings or legal conclusions. Judge Kenneth M. Karas therefore adopted the proposed findings, dated October 21, 2016, in their entirety.
The court ordered the Clerk to enter judgment for Development Specialists pursuant to Judge Drain’s recommendation. It also ordered Development Specialists to mail the order to Varanese by Federal Express International Mail Service and email, file a certificate confirming that mailing, close the case, and mail Varanese a copy of the order.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.