Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-01028/USCOURTS-azd-2_10-cv-01028-0/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NOT FOR PUBLICATION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 the matter of:

Bashas’ Inc.; Bashas’ Leaseco Inc.,

Debtors. __________________________________

Ella Yazzie, 

Plaintiff, 

vs.

Bashas’ Inc.; Bashas’ Leaseco, Inc., 

Defendants. 

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No. CV-10-01028-PHX-FJM

ORDER

The court has before it debtors/defendants Bashas’ Inc. and Bashas’ Leaseco Inc.’s

motion to withdraw the reference to a bankruptcy judge (doc. 2) and plaintiff Ella Yazzie’s

response (doc. 6).

I

In March 2009, plaintiff’s son Andy was struck and killed by a Bashas’ truck backing

into a loading dock at a supermarket in Chinle, Arizona. In June 2009, plaintiff brought

negligence claims against debtors on behalf of herself and the estate in a Navajo tribal court.

Although the parties provide little detail on the status of the tribal case, which also involves

claims against a property owner and the driver of the truck, we note that non-Indian entities

Case 2:10-cv-01028-FJM Document 7 Filed 07/15/10 Page 1 of 3
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are not subject to the jurisdiction of the tribal court. Plains Commerce Bank v. Long Family

Land & Cattle Co., __ U.S. __, __, 128 S. Ct. 2709, 2726 (2008); Montana v. United States,

450 U.S. 544, 101 S. Ct. 1245 (1981). Nevertheless, the entire case was apparently stayed

after debtors entered Chapter 11 bankruptcy in July 2009. Motion, Ex. 3 at 2 (“Because of

the automatic stay, no serious discovery has been advanced in the Navajo Nation case.”). In

the bankruptcy case, plaintiff filed proofs of claim and moved for an “evidentiary hearing to

determine the debtors’ culpability or responsibility for the personal injury to and wrongful

death of her son.” Id. Debtors opposed the motion, which is pending. In this court, they

move to withdraw the reference with respect to plaintiff’s claims. They contend that

plaintiff’s claims should be tried in district court because they are personal injury and

wrongful death claims. Plaintiff agrees.

II

For cause shown, a “district court may withdraw, in whole or in part, any case or

proceeding referred” to a bankruptcy judge. 28 U.S.C. § 157(d). Debtors assert that

withdrawal of the reference is appropriate due to the nature of plaintiff’s claims and the

following statutory provisions:

The district court shall order that personal injury tort and wrongful death

claims shall be tried in the district court in which the bankruptcy case is

pending, or in the district court in which the claim arose, as determined by the

district court in which the bankruptcy case is pending.

Id. § 157(b)(5). This paragraph is part of a subsection concerning the authority of

bankruptcy judges. Another paragraph of the subsection makes a distinction between the

estimation of claims for the purposes of confirming a Chapter 11 plan, on the one hand, and

“the liquidation or estimation of contingent or unliquidated personal injury tort or wrongful

death claims” for purposes of distribution on the other. Id. § 157(b)(2)(B). The former is

included among the core proceedings that a bankruptcy judge can hear and determine, while

the latter is not. Debtors do not discuss the current status of their bankruptcy case or what

effect, if any, this distinction has on the merits of their motion.

In order to ensure that our resolution did not disrupt the on-going bankruptcy

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proceeding, we consulted with Judge Marlar, who advises that the proceeding is at the plan

confirmation stage. Under these circumstances, it is premature to adjudicate the Yazzie

claims. See, e.g., Roberts v. Johns-Manville Corp. (In re Johns-Manville Corp.), 45 B.R. 823

(S.D.N.Y. 1984). If, after confirmation, adjudication of the claims is not mooted, we can

always try the claims at a later date. Judge Marlar suggests that Yazzie request a status

hearing in the bankruptcy case.

IT IS THEREFORE ORDERED DENYING Bashas’ Inc. and Bashas’ Leaseco

Inc.’s motion to withdraw the reference without prejudice to renewing it if it becomes

necessary in the future (doc. 2).

DATED this 15th day of July, 2010.

cc: The Hon. James M. Marlar, United States Bankruptcy Judge, District of Arizona,

Tucson Division.

Case 2:10-cv-01028-FJM Document 7 Filed 07/15/10 Page 3 of 3