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Hoang v. Rosen

United States District Court, D. Maryland

May 14, 2015

GARY A. ROSEN et al. Appellees MINH VU HOANG Appellant


DEBORAH K. CHASANOW, District Judge.

Appellant Minh Vu Hoang ("Ms. Hoang" or "Appellant"), a debtor in the underlying bankruptcy case, appeals from an order entered by United States Bankruptcy Judge Thomas J. Catliota on August 18, 2014, granting summary judgment to Appellee Gary A. Rosen, the chapter 7 trustee ("the Trustee" or "Mr. Rosen"), and the estate's realtor, Jocelyn McClure ("Ms. McClure"), and dismissing Appellant's counterclaims as either moot or collaterally estopped. (ECF No. 1-12). Ms. Hoang also seeks to proceed in forma pauperis on her bankruptcy appeal. Finally, she filed a motion for case reassignment. (ECF No. 8). Because the facts and legal arguments are adequately presented in the briefs and record, oral argument is deemed unnecessary. See Fed.R.Bankr.P. 8012; Local Rule 105.6. For the reasons that follow, the in forma pauperis application will be granted, but the appeal will be dismissed pursuant to 28 U.S.C. § 1915(e)(2). Appellant's motion for case reassignment also will be denied.

I. Background

The thorny factual background underlying this bankruptcy case was set forth in numerous prior opinions, thus only the facts relevant to the instant appeal will be included. See In re Hoang, 469 B.R. 606 (D.Md. 2012).

On May 10, 2005, Minh Vu Hoang filed a voluntary petition under Chapter 11 of the bankruptcy code in the United States Bankruptcy Court for the District of Maryland. Her husband, Thanh Hoang, separately filed a chapter 11 petition on July 12, 2005. Both cases were subsequently converted to chapter 7 and the bankruptcy court ordered that the estates be jointly administered. Gary Rosen was appointed as the Chapter 7 trustee. Thereafter, the Trustee commenced numerous adversary proceedings to recover property of the estate that Appellant had attempted to conceal through various business entities with which she was associated. She failed to report these entities on her bankruptcy schedules and her statement of financial affairs, and she was criminally indicted on charges related to bankruptcy and tax fraud. On October 13, 2010, Appellant pled guilty to conspiracy to defraud an agency of the United States, in violation of 18 U.S.C. § 371. She was sentenced to a term of imprisonment of sixty months.

On January 17, 2012, Trustee Rosen commenced an adversary proceeding against MV General Partnership and Thieny, LLC, as part of an ongoing effort to recover estate property fraudulently concealed by Appellant. (Bankr.Case No. 12-00056, ECF No. 1). According to the complaint, the property was purchased at a foreclosure sale on March 23, 2004 by MV General Partnership in the amount of $110, 000. Citing an attached wire transaction detail report and bank statement showing that the settlement amount of $99, 065.13 was wired from the Law Offices of Craig Parker from an account associated with Ms. Hoang, the trustee alleged that the purchase funds were, in fact, property of the bankruptcy estate. Gary Rosen, as trustee, sought a declaration that Spruce Avenue was estate property; the imposition of a constructive trust; a declaration that MV General Partnership had no legal right, title, or interest in the property, and that the trustee was entitled to dominion and control; a declaration that a deed of trust to Thieny, LLC was null and void; and an order directing turnover of the property and authorizing the trustee to sell it.

Despite being provided an opportunity to obtain counsel, counsel was not retained for MV General Partnership and Thieny, LLC and default was entered. On February 15, 2013, the trustee moved for entry of default judgment. The bankruptcy court granted the motion on March 26, 2013, and default judgment was entered against MV General Partnership and Thieny, LLC. The judgment provided, in relevant part, that the trustee was "authorized to list Spruce Avenue for sale with a multiple listing service through the offices of a real estate agent to be approved by this court upon proper Application thereof by the Plaintiff/Trustee with any sale subject to notice to all parties-in-interest and opportunity to object thereto as provided by the Bankruptcy Code and Rules of Procedure." (Bankr.Case No. 12-00056, ECF No. 56, at 3).

The trustee filed, in the main bankruptcy case, notice of his intent to sell the Spruce Avenue property and an application for compensation to a real estate agent associated with the sale. (Bankr.Case No. 05-21078, ECF Nos. 2294, 2295). Appellant objected to the notice of sale, requesting that the bankruptcy court abstain from approving the sale. The bankruptcy court overruled her objection and approved the sale of the property.

On August 12, 2013, Appellant noted an appeal in the bankruptcy court from the order in the main bankruptcy case authorizing the sale of the Spruce Avenue property and payment of the commission in relation thereto. Seven days later, the Spruce Avenue property was sold to JLN Development, LLC, in the amount of $107, 033.96. (Bankr.Case No. 05-21078, ECF No. 2356).

On July 29, 2013, while Ms. Hoang was litigating in the bankruptcy and district court regarding the Spruce Avenue property, she filed a pro se complaint and jury demand against Trustee Gary Rosen and real estate agent Jocelyn A. McClure in the Circuit Court for Anne Arundel County, Maryland, Case No. 02-C-13-180383. ( See ECF No. 7-8). In the complaint, Ms. Hoang requested to establish a mechanic's lien on the Spruce Avenue property for $100, 000 in repairs allegedly performed after a flood in 2006, and asserted claims for fraud and negligence against Mr. Rosen and Ms. McClure. Appellant also alleged that MV General Partnership assigned the property to her and her spouse, and that she has rights in the property from another assignment under the Thieny, LLC Deed of Trust. ( Id. ).

On September 25, 2013, Appellee Gary A. Rosen, the Chapter 7 trustee in the underlying bankruptcy case, and Jocelyn A. McClure, the Trustee's real estate agent appointed to market and sell the real property owned by the bankruptcy estate, commenced the adversary proceeding against Ms. Hoang in the United States Bankruptcy Court for the District of Maryland from which this appeal arises. (Bankr.Case No. 13-00551-TJC). The adversary proceeding sought a permanent injunction against Ms. Hoang from filing any personal actions or proceedings against the Chapter 7 trustee, Gary Rosen, or any of the bankruptcy estate's professionals, without first obtaining express leave of the bankruptcy court. ( Id. at ECF No. 1). Appellees moved for a preliminary injunction, (ECF No. 2), which the court granted on October 7, 2013. ( Id. at ECF No. 11). The order enjoined preliminarily Appellant and all persons acting in concert or in cooperation with her from the continued maintenance or prosecution of the circuit court complaint. ( Id. at 3). Appellant further was ordered to dismiss with prejudice her complaint in the circuit court by October 17, 2013. Appellant filed a motion to vacate the order directing dismissal and a motion to remove the adversary proceeding to state court. The bankruptcy court denied both motions. On November 25, 2013, the bankruptcy court issued an order giving Appellant another fourteen (14) days to comply with the October 7, 2013 order and dismiss her action in circuit court. (Bankr.Case No. 13-00551, at ECF No. 27). On December 6, 2013, Appellant filed evidence of the dismissal of her action in the circuit court. ( Id. at ECF No. 38).

On the same day, Appellant filed a counterclaim against Trustee Rosen and Ms. McClure. ( Id. at ECF No. 37). Appellees moved to dismiss the counterclaim and separately moved for summary judgment on their complaint. ( Id. at ECF Nos. 41 & 42). Appellant opposed both motions. Judge Catliota issued a memorandum opinion and order on August 18, 2014, granting summary judgment, dismissing the counterclaims, and permanently enjoining Appellant from filing any further actions against the Trustee or the bankruptcy estate's professionals in any forum without filing a motion requesting leave from the bankruptcy court. (ECF Nos. 1-12 & 1-13).

The instant appeal was docketed in district court on October 6, 2014.[1] (ECF No. 1). After Ms. Hoang failed to file a brief within fourteen (14) days in accordance with Bankruptcy Rule 8009(a), the court issued a show cause order on October 30, 2014. (ECF No. 3). Appellant filed a response to the show cause order on November 13, 2014, (ECF No. 4), and Appellees replied (ECF No. 5). Ms. Hoang finally filed her brief and exhibits on December 4, 2014 (ECF Nos. 6 & 7), [2] and Appellees filed an opposition brief on January 15, 2015 (ECF No. 9). Appellant also filed a motion requesting that the appeal be reassigned to a judge in the Northern Division. (ECF No. 8).

II. Analysis

A. Motion for Case Reassignment

Appellant filed a motion requesting that her case be "assigned to a judge in the division of the Maryland U.S. District Court other than a judge whose chambers are in the courthouse where the bankruptcy case is pending." (ECF No. 8). Appellant argues that the Wasserman Bankruptcy Appeals Manual requires that the case be reassigned to a judge who does not sit in the same courthouse as Judge Catliota, the presiding bankruptcy judge. Nothing in the bankruptcy rules requires a bankruptcy appeal to be reassigned to a judge in a different division from where the bankruptcy case is pending.[3] Accordingly, Appellant's motion for case reassignment will be denied.

B. In Forma Pauperis Application

On October 6, 2014, Appellant filed in the bankruptcy court an "Application for Waiver of the Chapter 7 Filing Fee for Individuals Who Cannot Pay the Filing Fee in Full or In Installments." (Bankr.Case No. 13-00551-TJC, at ECF No. 68). Appellees opposed the application in the bankruptcy case. ( Id. at ECF No. 71). The application has not been adjudicated by the bankruptcy court, however; instead, the application and the opposition thereto were transmitted to this court with the appeal. ( See ECF Nos. 1-14 & 1-15). As the Appellees point out in their opposition, the application "does not even designate for which proceeding [Appellant] is requesting the fees to be waived." (ECF No. ...

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