In Re: The Great Atlantic & Pacific Tea Company, Inc.

Background

Michele Brown, representing herself and unable to pay filing fees, appealed an August 20, 2018 order from the United States Bankruptcy Court for the Southern District of New York. That order denied Brown’s request to reconsider or vacate an earlier order disallowing and expunging her personal-injury claims in The Great Atlantic & Pacific Tea Company, Inc.’s second Chapter 11 bankruptcy proceeding.

Brown alleged that she was injured in a slip-and-fall accident at a Pathmark store in June 2009. She filed a claim based on that accident in A&P’s first bankruptcy proceeding. Under the confirmed plan in that proceeding, the claim was discharged, and Brown was entitled only to a proportional share of a recovery pool for general unsecured creditors if money remained after secured creditors were paid. The opinion states that no money ultimately remained for unsecured creditors.

A&P and its affiliates later filed a second Chapter 11 bankruptcy proceeding. Brown filed two claims in that proceeding, identifying the basis as a “2016 New Claim.” The Bankruptcy Court found that the claims were based on the same 2009 accident and therefore had already been discharged in the first bankruptcy proceeding. It disallowed and expunged the claims in a December 22, 2017 order.

Brown later asked the Bankruptcy Court to reconsider or vacate that order. The Bankruptcy Court denied her request on August 20, 2018, again stating that the claims had been discharged. It warned that further attempts to assert or collect on claims based on the 2009 accident could result in sanctions, including A&P’s reasonable attorney’s fees.

Appeal and jurisdiction

Brown previously filed an appeal in March 2019, but that appeal was dismissed without prejudice for failure to prosecute after she did not file the required appellate materials. She filed the appeal addressed in this opinion on May 3, 2022.

A&P moved to dismiss the appeal and requested sanctions under Rule 8020 of the Federal Rules of Bankruptcy Procedure. Judge Briccetti held that the District Court lacked jurisdiction to hear the appeal because Brown did not file a timely notice of appeal. Rule 8002 generally requires a bankruptcy appeal to be filed within 14 days after the order being appealed. The order at issue was entered on August 20, 2018, but Brown did not file this appeal until May 3, 2022.

The court also found that Brown’s later letters asking the Bankruptcy Court to reconsider the decision did not extend the deadline because they were filed months after the relevant 14-day period. Brown did not move for an extension of the appeal deadline. Because the appeal was untimely, the court dismissed it without reaching the merits of whether the Bankruptcy Court correctly expunged Brown’s claims.

Sanctions

The court separately considered A&P’s request for sanctions. Rule 8020 permits a court to award damages and costs when a bankruptcy appeal is frivolous, meaning it lacks a reasonable legal or factual basis. Judge Briccetti concluded that the appeal was frivolous because it was untimely, Brown offered no legal authority or evidence supporting reversal of the Bankruptcy Court’s orders, and the appeal had no chance of success based on the record.

The court determined that it could impose sanctions even though it lacked jurisdiction over the appeal itself. It also found that Brown had received notice that sanctions were being considered and had a reasonable opportunity to respond. In light of Brown’s status as a self-represented litigant who could not pay filing fees, the court declined to impose sanctions beyond an award of A&P’s reasonable attorney’s fees incurred in defending the appeal.

Disposition

The court granted A&P’s motion to dismiss. It also granted A&P’s request for sanctions to the extent that it awarded reasonable attorney’s fees incurred in connection with the appeal. The amount was to be determined after A&P submitted supporting documentation and Brown had an opportunity to respond. The court also certified that any appeal from this opinion would not be taken in good faith and denied Brown permission to proceed without paying filing fees for such an appeal.