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Dailey v. Thomas

United States District Court, D. Maryland

March 23, 2017



          Ellen Lipton Hollander United States District Judge.

         Mitzi Elaine Dailey, the self-represented Debtor/Appellant, noted an appeal to this Court from an order issued by the United States Bankruptcy Court for the District of Maryland (Schneider, J.), dismissing Dailey's Chapter 13 bankruptcy case, JFS-15-25464 (“Bankruptcy Case”). ECF 1; ECF 1-1. Dailey also appeals the Bankruptcy Court's “denial” of her emergency motion for relief from violations of automatic stay, pursuant to 11 U.S.C. § 362 (“Emergency Motion”). Id.

         Dailey's brief is at ECF 3-1 (“Appellant Brief”).[1] Robert S. Thomas, II, Appellee/Trustee, filed an opposing brief. ECF 6 (“Appellee Brief”).[2] No reply has been filed and the time to do so has expired. See Fed. R. Bankr. P. 8018(a)(3); Local Rule 105.2(a).

         The Court is mindful of its obligation to construe liberally the pleadings of a pro se litigant, which are “held to less stringent standards than formal pleadings drafted by lawyers.” Erickson v. Pardus, 551 U.S. 89, 94 (2007); see also White v. White, 886 F.2d 721, 722-23 (4th Cir. 1989). I note, however, that although Dailey is self-represented, she is an attorney and a member of the Maryland Bar. See ECF 3-1 at 7.

         No hearing is necessary to resolve the appeal. See Local Rule 105.6. For the reasons that follow, I shall affirm the Order of the Bankruptcy Court dismissing the Bankruptcy Case.

         I. Factual and Procedural Background[3]

         This appeal is related to several other cases in this Court: GLR-15-2527; JFM-16-0299; and JFM-16-3073.

         “[A] court may properly take judicial notice of 'matters of public record' and other information that, under Federal Rule of Evidence 201, constitute 'adjudicative facts.'” Goldfarb v. Mayor & City Council of Baltimore, 791 F.3d 500, 508 (4th Cir. 2015); see also Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007); Katyle v. Penn Nat'l Gaming, Inc., 637 F.3d 462, 466 (4th Cir. 2011), cert. denied, 565 U.S. 825 (2011); Philips v. Pitt Cnty. Memorial Hosp., 572 F.3d 176, 180 (4th Cir. 2009). Pursuant to Fed.R.Evid. 201, a court may take judicial notice of adjudicative facts if they are “not subject to reasonable dispute, ” in that they are “(1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” Of import here, in Anderson v. Fed. Deposit Ins. Corp., 918 F.2d 1139, 1141 n. 1 (4th Cir. 1990), the Court recognized that a district court may “properly take judicial notice of its own records.”

         Cases JFM-16-0299 and JFM-16-3073 involved appeals from the Bankruptcy Court's dismissal of adversary proceedings filed by Dailey in her Bankruptcy Case. See JFS-15-0611 (“First Adversary Proceeding”) and JFS-16-0257 (“Second Adversary Proceeding”). In JFM-16-0299, Judge J. Frederick Motz affirmed the Bankruptcy Court's dismissal of the First Adversary Proceeding. See ECF 10 (Memorandum); ECF 11 (Order). And, in JFM-16-3073, Judge Motz affirmed the Bankruptcy Court's dismissal of the Second Adversary Proceeding. ECF 10.

         The adversary proceedings are related, in turn, to an employment discrimination case filed by Dailey in this Court on August 26, 2015. See GLR-15-2527 (“Employment Case”). By Memorandum Opinion (ECF 42) and Order (ECF 43) of April 18, 2016, Judge George Levi Russell, III dismissed the Employment Case. The Fourth Circuit affirmed on November 4, 2016. ECF 48; see Dailey v. Lew, ___ Fed.App'x ___, No. 16-1464, 2016 WL 6543457 (4th Cir. Nov. 4, 2016).

         In the matter sub judice, Dailey's Appellant Brief (ECF 3-1) is identical to the one she filed in the Second Adversary Proceeding. See ECF 3-4 in JFM-16-3073. The arguments contained in the brief are largely directed to the appeal as to the Second Adversary Proceeding.

         On August 26, 2015, Dailey, an attorney licensed in Maryland and an employee of the Internal Revenue Service (“IRS”), United States Department of the Treasury (“Treasury” or “the Agency”), filed suit in this Court against Jacob J. Lew, then Secretary of the Treasury, and nine other individual federal employees who worked at the Agency, asserting allegations of employment discrimination and retaliation. See GLR-15-2527, ECF 1. Dailey accused the defendants of wrongfully charging her with Away Without Leave (“AWOL”) hours “on five specific dates in March and August 2015” (GLR-15-2527, ECF 42 at 5), totaling 80 hours or 10 days. Id. at 20. Dailey also claimed that her employer withheld $3744 in salary for 72 of the AWOL hours. Id., ECF 1 at 12-13.

         Lew filed a motion to dismiss or, in the alternative, for summary judgment (id., ECF 24).[4]Dailey filed a motion for preliminary injunctive relief (id., ECF 30) and a temporary restraining order (id.; ECF 31), seeking to enjoin the Agency from taking any measures to prevent her from teleworking or from charging her with AWOL. Thereafter, on April 18, 2016, Judge Russell granted Lew's motion, denied Dailey's motions, and dismissed the case. GLR-15-2527, ECF 42 (Memorandum Opinion); ECF 43 (Order); see Dailey v. Lew, et al., CV GLR-15-2527, 2016 WL 1558150 (D. Md. Apr. 18, 2016). Dailey noted an appeal to the Fourth Circuit. GLR-15-2527, ECF 44. As indicated, the Fourth Circuit affirmed. Id.; ECF 48.

         On November 6, 2015, while the Employment Case was pending, Dailey filed a voluntary petition for bankruptcy under Chapter 13 of the United States Bankruptcy Code. See JFS-15-25464, ECF 1. Soon after, Dailey filed a Chapter 13 Plan, which she later amended.

         A few days after Dailey filed for bankruptcy, Dailey filed an adversary proceeding against three IRS employees who were also defendants in the Employment Case -Katherine D. Heyden, Lawrence W. Ford, and Milissa K. Riggs. She also sought, inter alia, an injunction to prevent the Agency and her supervisors from implementing a five-day suspension, without pay, based on a finding that Dailey had been AWOL. See JFS-15-0611, i.e., the First Adversary Proceeding, ECF 1.[5] The United States moved to substitute itself as the sole defendant and to dismiss the adversary proceeding on the ground that the law foreclosed Dailey from using an adversary proceeding as an “end-run” around her Employment Case. JFS-15-0611, ECF 11 at 2.

         On January 20, 2016, the Bankruptcy Court granted the United States's motion to substitute and to dismiss the First Adversary Proceeding, with prejudice. JFS-15-0611, ECF 13. Dailey noted an appeal to this Court and, on May 26, 2016, Judge Motz affirmed the Bankruptcy Court's dismissal of the First Adversary Proceeding. See JFM-16-0299, ECF 10 (Memorandum); ECF 11 (Order). Judge Motz said, id; ECF 10 at 1-2: “The Bankruptcy Court's ruling was clearly correct. Employment discrimination actions are non-core proceedings reserved for exclusive jurisdiction by the district courts… .The Bankruptcy Court lacked jurisdiction over the employment discrimination claim The next day, May 27, 2016, Dailey filed the Second Adversary Proceeding in the Bankruptcy Court against three IRS employees: Katherine D. Heyden, Robert L. Bryant, and Milissa K. Riggs. JFS-16-0257, ECF 1. The allegations in the Second Adversary Proceeding were similar to those in the First Adversary Proceeding. See id, ECF 1. The United States again moved to substitute itself as the proper defendant and to dismiss. Id., ECF 6.[6]

         Meanwhile, in the Bankruptcy Case, Dailey filed a Chapter 13 Plan on November 20, 2015. JFS-15-25464, ECF 17. The plan called for payment to the Chapter 13 Trustee in the amount of $760 per month for 60 months. Id., ECF 17. On December 31, 2015, the Debtor filed an Amended Chapter 13 Plan, which called for the same proposed payments to the Trustee. Id., ECF 25.

         On January 15, 2016, the Bankruptcy Court found that the proposed plan did not fulfill the requirements for confirmation, as set forth in 11 U.S.C. § 1325. Accordingly, the Bankruptcy Court entered an Order denying confirmation of the Chapter 13 Plan, with leave to amend. Id, ECF 29.

         The Debtor filed an amended Chapter 13 Plan on February 23, 2016. Id., ECF 35. At a hearing on March 23, 2016, the Bankruptcy Court determined that the amended plan did not fulfill the requirements for confirmation, as set forth in 11 U.S.C. § 1325. Id., ECF 39. The court entered an Order denying confirmation, with leave to amend. Id.

         The Debtor filed her fourth Chapter 13 Plan on April 6, 2016. Id., ECF 41 (“Plan”). Consistent with each of the previously proposed Chapter 13 plans, this Plan proposed payments of $760 per month for 60 months. Id. However, on May 3, 2016, the Trustee filed an objection to the Plan. ECF 44. According to the Trustee, the Debtor had failed to tender two of the five payments that had come due under the terms of the proposed Plan, totaling $1, 520. Id. at 2.

         The Bankruptcy Court held a hearing on May 11, 2016, at which it considered the Plan and the Trustee's objection. JFS-15-25464, ECF 45. The hearing was continued, first until July 27, 2016 (id., ECF 65) and then to August 22, 2016. See id., ECF 66; ECF 70.

         In the interim, on June 1, 2016, the Debtor filed her Emergency Motion for relief from violation of automatic stay, pursuant to 11 U.S.C. § 362. Id., ECF 51. In the Emergency Motion, the Debtor alleged that the IRS violated the automatic stay by imposing a five-day suspension on her, without pay, from April 25, 2016 through April 29, 2016, as discipline for the charge of being AWOL. Id. Dailey noted that after she filed for bankruptcy, the IRS filed its proof of claim on November 19, 2015, for taxes owed. Id. at 4. She asserted that the withheld wages are “property of the estate” and moved that they be turned over to the Chapter 13 Trustee. Id. at 6.

         In its opposition to the Emergency Motion (JFS-15-25464, ECF 55), the IRS argued that it “acted lawfully in suspending Debtor and thus did not violate the automatic stay.” Id. at 3.

         The IRS explained, id.:

[T]he IRS proposed to suspend Debtor for five days without pay on November 5, 2015 - before she filed for Chapter 13 bankruptcy - based on multiple occasions of being [AWOL] and her failure to follow proper leave procedures…The IRS had cause to propose this discipline and the timing refutes any suggestion that the IRS ...

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