Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_07-cv-01915/USCOURTS-azd-2_07-cv-01915-0/pdf.json

Nature of Suit Code: 423
Nature of Suit: Bankruptcy Withdrawal 28 USC 157
Cause of Action: 28:0157 Motion for Withdrawal of Reference

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NOT FOR PUBLICATION

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

In re:

Mathon Fund, LLC, et al.

Debtors.

_________________________________

Mathon Participating Trust, 

Plaintiff, 

vs.

Denny Barney, 

Defendant.

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No. CV-07-1915-PHX-FJM

ORDER

The court has before it defendant’s motion to withdraw the reference of the adversary

proceeding from the bankruptcy court (doc. 2). The plaintiff has not objected. 

Plaintiff Mathon Participating Trust filed a complaint against defendant Denny Barney

seeking the avoidance and recovery of alleged fraudulent transfers. When a defendant is

sued in an adversary proceeding to recover a fraudulent transfer, the defendant has a Seventh

Amendment right to a jury trial provided that he has not filed a claim against the bankruptcy

estate. Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 64-65, 109 S. Ct. 2782, 2802 (1989);

Langenkamp v. Culp, 498 U.S. 42, 45, 111 S. Ct. 330, 331 (1990). A bankruptcy judge may

Case 2:07-cv-01915-FJM Document 6 Filed 12/03/07 Page 1 of 2
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conduct a jury trial only if specially designated to exercise such jurisdiction by the district

court and with the express consent of all the parties. 28 U.S.C. § 157(e). 

Because defendant has not filed a claim against the bankruptcy estate he is entitled to

a jury trial. However, even where a constitutional right to a jury trial exists, a bankruptcy

court may retain jurisdiction over pre-trial matters, including dispositive motions. Sigma

Micro Corp. v. Healthcentral.com (In re Healthcentral.com), 504 F.3d. 775, 787-88 (9th Cir.

2007). In the interest of “promot[ing] judicial economy and efficiency by making use of the

bankruptcy court’s unique knowledge of Title 11 and familiarity with the action[ ] before

[it],” id., we decline to withdraw the reference at this early stage of the adversary proceeding.

The bankruptcy court will preside over the discovery and dispositive motion phases of the

adversary proceeding. We will entertain a new motion to withdraw the reference in the

unlikely event a jury trial is needed.

Therefore, IT IS ORDERED DENYING defendant’s motion to withdraw the

reference of the adversary proceeding (doc. 2). 

DATED this 30th day of November, 2007.

Case 2:07-cv-01915-FJM Document 6 Filed 12/03/07 Page 2 of 2