In Re: 461 7th Avenue Market, Inc.
- Philip Halpern
- 7:20-cv-06216
- U.S. District Court · Southern District of New York
- 5
In Re: 461 7th Avenue Market, Inc., Judge Halpern directed letters on jurisdiction and terminated pending motions without deciding the appeal.
The order affected 461 7th Avenue Market, Inc., the Appellee Delshah 461 Seventh Avenue, LLC, and Chapter 7 Trustee Marianne T. O’Toole by requiring jurisdiction letters and terminating pending motion sequences.
What happened
In In Re: 461 7th Avenue Market, Inc., a Chapter 7 trustee asked to discuss dismissing an appeal from bankruptcy-court orders converting the debtor’s case and denying reconsideration. The trustee argued that the debtor lacked authority to pursue the appeal and that later events made the appeal unfair to decide.
The trustee also asked, alternatively, for permission to file a friend-of-the-court brief or for the appeal to be paused while a related appeal was pending. The provided opinion text does not show a ruling granting or denying those requests.
Judge Philip M. Halpern ordered the Appellee and Trustee to file letters by November 20, 2020, addressing whether the appeal had removed this Court’s authority to act. Judge Halpern also directed the Clerk to terminate the pending motions at docket entries 46 and 49.
The detailed version
- In Re: 461 7th Avenue Market, Inc. · No. 7:20-cv-06216
- Philip Halpern
- Nov. 4, 2020
Background
The bankruptcy court converted 461 7th Avenue Market, Inc.’s case to Chapter 7 on July 15, 2020. Marianne T. O’Toole was appointed interim trustee and later became the permanent Chapter 7 trustee. The debtor appealed the conversion order and the bankruptcy court’s later order denying reconsideration.
In this federal district court, the former debtor-in-possession sought a preliminary injunction, a stay during the appeal, reinstatement as the Chapter 11 debtor-in-possession, and permission to operate the deli or market. On October 2, 2020, the Court denied that application based on lack of standing and the failure to make the showing required for a stay. The appellant then appealed that decision to the United States Court of Appeals for the Second Circuit.
Relief Requested
The Trustee, who was a non-party to this district-court appeal, requested a conference before filing a motion to dismiss the appeal. The Trustee argued that the debtor lacked standing because, after a Chapter 7 trustee is appointed, the trustee controls the bankruptcy estate and has authority to pursue the debtor’s legal claims. The Trustee also argued that the appeal was equitably moot because the debtor’s personal property had been abandoned, the premises had been surrendered, the lease had been rejected, and no funds remained in the estate.
Alternatively, the Trustee requested permission to seek leave to file a friend-of-the-court brief under Bankruptcy Rule 8017(a), or to hold the appeal in abeyance while the Second Circuit considered an appeal from the Court’s October 2, 2020 decision.
Court’s Action
The Court ordered the Appellee and Trustee to file letters of no more than two pages by 5:00 p.m. on November 20, 2020, addressing whether the interlocutory appeal had removed this Court’s authority to act. The Clerk was directed to terminate the pending motion sequences at docket entries 46 and 49.
The provided text does not show that the Court granted or denied the Trustee’s requested dismissal, permission to file a friend-of-the-court brief, or request to pause the appeal. It also does not decide whether the appellant had standing or whether the appeal was equitably moot. The order therefore addresses the Court’s jurisdiction and pending motions without resolving the appeal’s merits.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.