Local No. 171 Pension Fund v. Biehl Cleaners, Inc.
- Rochon
- 1:22-cv-02133
- U.S. District Court · Southern District of New York
- 1
Judge Rochon granted a bankruptcy-related stay of proceedings against the Delbert M. Stone Revocable Trust in Local No. 171 Pension Fund v. Biehl Cleaners, Inc.
The Delbert M. Stone Revocable Trust, the parties to the case, and the bankruptcy estate were affected. Proceedings against the Trust were stayed, scheduled proceedings were adjourned without a date, and the parties were required to provide a status update.
What happened
Local No. 171 Pension Fund v. Biehl Cleaners, Inc. involved a request to pause the case against the Delbert M. Stone Revocable Trust while a bankruptcy-related stay was in effect. The complaint described the Trust as only a nominal party and alleged that the owners held their interests in Biehl Cleaners, Inc. individually and through the Trust.
The parties consented to pausing the proceedings against the Trust. The court granted that request, explaining that a court may extend a bankruptcy stay to a non-debtor when continuing the case could immediately harm the bankruptcy estate.
Judge Jennifer L. Rochon directed the parties to provide a status update by October 30, 2023, or within seven days after the bankruptcy stay ended, whichever came first. All scheduled conferences and proceedings were adjourned without a new date, and the clerk was directed to terminate the motions pending at ECF Nos. 62 and 65.
The detailed version
- Local No. 171 Pension Fund v. Biehl Cleaners, Inc. · No. 1:22-cv-02133
- Rochon
- May 23, 2023
Background
The plaintiff requested that the bankruptcy stay also apply to the Delbert M. Stone Revocable Trust, a non-debtor defendant. The request was made with the defendants' consent. The opinion states that the complaint described the Trust as only a nominal party and alleged that the owners of Biehl Cleaners, Inc. owned that corporation individually and through the Trust.
Ruling
The court granted the request to stay the proceedings against the Trust. It explained that although a bankruptcy filing generally does not stay a lawsuit against a co-defendant who is not the debtor, a court may stay such a proceeding when it would have an immediate adverse economic effect on the bankruptcy estate. The court relied on the parties' consent and the allegations concerning the Trust's role.
Effect of the Order
The parties were directed to update the court about the case by October 30, 2023, or within seven days after the bankruptcy stay was lifted, whichever occurred earlier. All scheduled conferences and proceedings were adjourned without a date. The clerk was directed to terminate the motions pending at ECF Nos. 62 and 65.
Read the full 1-page opinion on CourtListener, the free public archive maintained by the Free Law Project.