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Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 18, 2009 Decided October 27, 2009

No. 08-7089

IN THE MATTER OF: GREATER SOUTHEAST 

COMMUNITY HOSPITAL FOUNDATION, INC.,

ADVANTAGE HEALTHPLAN INC. AND ELLIOT R. WOLFF,

APPELLANTS

v.

PATRICK J. POTTER ET AL.,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 1:08-cv-00166-CKK)

Dennis Lane argued the cause for the appellants. Janet M.

Nesse was on brief.

Patrick J. Potter argued the cause for the appellees.

Stephen E. Leach and D. Marc Sarata were on brief.

Before: GINSBURG, HENDERSON and GARLAND, Circuit

Judges.

Opinion for the Court filed by Circuit Judge HENDERSON.

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1

The three affiliates are Fort Washington Nursing Home, Inc.,

Greater Southeast Management Company and Greater Southeast

Community Hospital Corporation.

2

Unless otherwise noted, all dates refer to 2007.

KAREN LECRAFT HENDERSON, Circuit Judge: Appellants

Advantage Health Plan Inc. (Advantage) and Elliot R. Wolff, its

president, appeal a decision of the district court which (1)

affirmed the bankruptcy court’s order striking a document that

Wolff signed and submitted on behalf of Advantage on the

ground Wolff is not a licensed lawyer and (2) struck Wolff as an

appellant in the district court for lack of prudential standing.

Advantage HealthPlan, Inc. v. Potter, 391 B.R. 521 (D.D.C.

2008). For the following reasons, we affirm the district court’s

decision.

I.

In 1999, Greater Southeast Community Hospital

Foundation, Inc. and three affiliates1 filed petitions in the United

States Bankruptcy Court for the District of Columbia seeking

reorganization relief under Chapter 11 of the United States

Bankruptcy Code, 11 U.S.C. §§ 1101-1174. On October 23,

2001, the bankruptcy court entered an order confirming the

debtors’ bankruptcy plan (Plan). The Plan established a threemember “Plan Committee” consisting of Eaton Vance

representing bondholders, Stanley Zupnik representing creditor

Welcome Homes, Inc., and Wolff representing creditor

Advantage. The Plan also provided for a “Plan Agent,” which

position was filled by Patrick J. Potter, a partner in the law firm

Pillsbury Winthrop Shaw Pittman LLC (Pillsbury). Pillsbury

acted as counsel for both the Plan Committee and the Plan

Agent. Eaton Vance resigned from the Plan Committee in June

2007.2

 

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Rule 9019 provides in relevant part: “On motion by the trustee

and after notice and a hearing, the court may approve a compromise

or settlement.” Fed. R. Bankr. P. 9019(a).

On August 3, Potter and Pillsbury moved the bankruptcy

court to approve the resignations of Potter as Plan Agent and

Pillsbury as counsel and to approve payment of legal fees and

expenses that Pillsbury alleged it was owed. Ten days later, the

Plan Committee notified the bankruptcy court it had discharged

Potter and Pillsbury and appointed a new Plan Agent and a new

Plan Committee counsel—Clinton E. Jones and Shulman,

Rogers, Gandal, Pordy & Ecker, P.A., respectively—mooting

Potter’s and Pillsbury’s motions seeking approval of their

resignations. 

 In late November, Zupnik—with the knowledge of the Plan

Committee members and Plan Committee counsel—offered to

settle the fee dispute with Pillsbury for $100,000. 391 B.R. at

529. In early December, the Plan Committee counsel met with

Pillsbury to discuss a settlement. Id. at 529-30. According to

the Plan Committee counsel, the parties reached a settlement and

the Plan Committee counsel agreed to draft a settlement

agreement and a motion to be filed pursuant to Federal

Bankruptcy Rule 9019;3

 Advantage disputed that the Plan

Committee authorized a settlement. Id. On December 7, the

Plan Committee moved to dismiss Potter’s motion for fees and

expenses. 

On December 13, counsel for the Plan Committee filed

emergency motions to withdraw as counsel (because of a

conflict with the Plan Committee) and, accordingly, to continue

the trial, which had been scheduled to begin on January 8, 2008,

and to extend discovery and motion deadlines. The bankruptcy

court immediately scheduled a hearing on the motions for

December 14. Wolff responded by letter to the court that he

would be unable to attend the December hearing “ ‘because of

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an essential commitment made four months ago’ ” but he

supported the Plan Committee counsel’s motions to withdraw

and to continue the trial and the Plan Committee’s motion to

dismiss Pillsbury’s motion for fees and expenses. Id. at 530.

The letter further stated:

If the [Pillsbury] litigation is not dismissed, Advantage

hopes that your final scheduling order will recognize

the factors and corresponding time necessary to select

a [second] successor legal counsel by the Plan

Committee, as well as the Holiday vacation plans of

both representatives of the Plan Committee. My

family will be on vacation outside the United States

from December 19 through January 5.

Id. 

At the December 14 hearing, the court directed the

withdrawing Plan Committee counsel and Potter to file a notice

of settlement of the fee dispute and a motion for approval

thereof and scheduled a settlement approval hearing for

December 21, with a deadline of 5:00 p.m. on December 19 for

filing objections to the settlement. A notice of the hearing was

electronically filed after the hearing and a copy was sent to

Wolff via e-mail. In accordance with the court’s directive, on

December 17 the Plan Committee filed a consent motion

(purportedly among the Plan Committee, Potter and Pillsbury)

seeking approval of the settlement pursuant to Fed. R. Bankr. P.

9019. The following day, the bankruptcy court issued an order

finding that “a settlement was reached among the Plan

Committee, [Pillsbury] and Potter, and that such settlement

included all of the necessary terms for an enforceable settlement

agreement” and that “[n]o evidence was presented that the Plan

Committee reached a decision that the Plan Committee should

not proceed with the settlement or that the documents that have

been drafted and exchanged among the parties . . . fail to reflect

the terms of the settlement.” Order, In re Greater Se. Cmty.

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Hosp. Found., Inc., No. 99-1159, at 2-3 (Bankr. D.D.C. Dec. 18,

2007). Accordingly, the order deferred disposition of the

emergency motions for withdrawal and continuance pending

resolution of the Rule 9019 motion and again provided notice of

the December 21 hearing and the December 19 objection

deadline.

On December 18, Advantage submitted an objection to the

settlement signed by Wolff. Objection to Motion Pursuant to

Bankruptcy Rule 9019 for Court Approval of Settlement

Agreement, In re Greater Se. Cmty. Hosp. Found., Inc., No. 99-

1159 (Bankr. D.D.C. Dec. 19, 2007) (Objection). The Objection

asserted that Advantage had not approved the settlement as

required, the bankruptcy hearing schedule “operated to preclude

Advantage from participating in the recent and critical judicial

deliberations in th[e] litigation to the prejudice of Advantage

and of the other Unsecured Creditors” and there had not been

“full and fair disclosure” of the settlement to creditors. Id. at 7.

The Objection further requested that the impending December

21 hearing be continued until January 17, 2008, that a hearing be

held on or after January 17, 2008 to reconsider whether the

settlement was approved by the Plan Committee and that “[b]oth

hearings requested above be continued until the Plan Committee

engages new legal counsel and the new legal counsel is prepared

on the subject matter of th[e] litigation.” Id. at 8.

On December 20, Pillsbury filed a response and motion to

strike the Objection on the ground that Wolff was not a licensed

lawyer and therefore could not represent Advantage. The next

morning, the court issued an order directing that “the objection

of Advantage [be] stricken in its entirety because it was not filed

by a licensed attorney authorized to practice before the Court.”

Order, In re Greater Se. Cmty. Hosp. Found., Inc., No. 99-1159,

at 1 (Bankr. D.D.C. Dec. 20, 2007) (Striking Order). The order

also denied Wolff’s requests to reconsider the December 18

order and to reschedule the December 21 hearing. Although no

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The district court declined to reach the appellees’ contention that

Wolff lacked standing to appeal the Striking Order. Advantage, 391

B.R. at 539.

one representing Advantage attended, the court conducted the

December 21 hearing as scheduled and, in the absence of an

objection, issued an order approving the settlement. Order, In

re Greater Se. Cmty. Hosp. Found., Inc., No. 99-1159 (Bankr.

D.D.C. Dec. 21, 2007) (Settlement Approval Order).

Advantage and Wolff filed a notice of appeal to the district

court. Appellees Potter and Pillsbury moved for summary

affirmance of the Striking Order and to strike Wolff as an

appellant. On July 14, 2008, the district court granted the

motions to strike Wolff for lack of standing to appeal and for

summary affirmance of the Striking Order. The court also

affirmed the Settlement Approval Order.4

 Advantage and Wolff

now appeal the district court’s judgment.

II.

Appellants Advantage and Wolff challenge both the district

court’s affirmance of the Striking Order as well as the court’s

grant of the motion to strike Wolff as an appellant. We address

each issue separately. 

A. The Striking Order

First, both Advantage and Wolff contend the district court

erred in affirming the bankruptcy court’s order striking

Advantage’s Objection. “When a court of appeals hears an

appeal from an order of a district court that resolved an appeal

from an order of the bankruptcy court, the court of appeals ‘sits

as a second court of review and applies the same standards as

the district court.’ ” 1 Collier on Bankruptcy ¶ 5.11 (15th ed.

rev. 2009) (quoting S. Technical Coll. v. Head, 89 F.3d 1381,

1383 (8th Cir. 1996)); accord In re KMart Corp., 381 F.3d 709,

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Wolff has not at any point in this litigation disputed the

bankruptcy court’s finding that he is not “a licensed attorney

authorized to practice before the [bankruptcy c]ourt.” Striking Order

at 1.

712-13 (7th Cir. 2004); In re Bogdan, 414 F.3d 507, 510 (4th

Cir. 2005); see United States v. Spicer, 57 F.3d 1152, 1159

(D.C. Cir. 1995) (“district court reviews bankruptcy court’s

grant of summary judgment de novo, and court of appeals

applies same standard in reviewing district court’s affirmance”).

Accordingly, we review the bankruptcy court’s Striking Order

itself and we do so for abuse of discretion. See Jackson v.

Finnegan, Henderson, Farabow, Garrett & Dunner, 101 F.3d

145, 150 (D.C. Cir. 1996) (“Our review of the district court’s . . .

grant of the [defendant’s] motion to strike is for abuse of

discretion.”). We conclude the bankruptcy court did not abuse

its discretion.

“It has been the law for the better part of two centuries . . .

that a corporation may appear in the federal courts only through

licensed counsel.” Rowland v. Cal. Men’s Colony, 506 U.S.

194, 201-02 (1993) (citing Osborn v. President of Bank of

United States, 22 U.S. (9 Wheat.) 738, 829 (1824)); see also

Bristol Petroleum Corp. v. Harris, 901 F.2d 165, 166 n.1 (D.C.

Cir. 1990) (“As a corporation, [defendant] could not appear pro

se.” (citing Commercial & R.R. Bank of Vicksburg v. Slocomb,

Richards & Co., 39 U.S. (14 Pet.) 60 (1840))). Under this wellestablished rule, Wolff was ineligible to represent Advantage in

a legal capacity5

 and the bankruptcy court correctly rejected the

legal filing Wolff submitted on Advantage’s behalf. Striking a

document that was filed unlawfully falls easily “within the range

of permissible alternatives that were available” to the court so as

to be within its discretion. Jackson, 101 F.3d at 150; see

Donovan v. Road Rangers Country Junction, Inc., 736 F.2d

1004, 1005 (5th Cir. 1984) (corporation’s co-defendant and sole

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shareholder “declined to hire counsel to represent the

corporation so the district court properly struck the defenses of

the corporation”); Strong Delivery Ministry Ass’n v. Bd. of

Appeals of Cook County, 543 F.2d 32, 33 (7th Cir. 1976)

(affirming dismissal of complaint filed by non-lawyer

corporation president). 

The appellants argue that the bankruptcy court should have

selected a less severe “sanction” than striking the Objection,

pointing to several cases in which we have discussed dismissal

as an appropriate sanction for misconduct. See Appellants’ Br.

at 16-17. These cases are inapposite for two reasons. First, the

bankruptcy court did not strike Advantage’s Objection as a

“sanction” for misconduct but because Wolff as a non-lawyer

was not authorized to file it on the corporation’s behalf. Second,

the court did not dismiss the action or otherwise terminate

Advantage’s involvement in it. The court merely struck a single

document that should not have been accepted for filing.

Advantage was free to continue participating in the bankruptcy

proceeding by obtaining legal counsel to represent it at the

December 21, 2007 hearing or to seek reconsideration of the

settlement approval thereafter, making the same arguments in

bankruptcy court Advantage made in district court and here.

Instead, foregoing available remedies in the bankruptcy court,

Advantage filed a notice of appeal to the district court, where it

faced the heavy burden of demonstrating abuse of discretion—a

burden it could not carry. Because the bankruptcy court acted

within its discretion in striking the Objection, we affirm the

district court’s affirmance of the Striking Order. 

B. Wolff’s Appellate Standing

Next, Wolff appeals the district court’s decision to strike

him as an appellant. The court concluded that Wolff lacked

prudential standing under the Bankruptcy Code to appeal the

bankruptcy court’s Settlement Approval Order because Wolff

was not a “person aggrieved” by the order. In McGuirl v. White,

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“[T]he ‘person aggrieved’ standard derives from a former

provision of the bankruptcy code.” McGuirl, 86 F.3d at 1234 (citing

11 U.S.C. § 67(c) (1976) (repealed 1978)). Although the provision

has been repealed, circuit courts have continued to apply its limitation.

See In re Westwood Cmty. Two Ass’n, Inc., 293 F.3d 1332, 1334 (11th

Cir. 2002) (citing Travelers Ins. Co. v. H.K. Porter Co., 45 F.3d 737,

741 (3d Cir. 1995); Depoister v. Mary M. Holloway Found., 36 F.3d

582, 585 (7th Cir. 1994); Holmes v. Silver Wings Aviation, Inc., 881

F.2d 939, 940 (10th Cir. 1989); Kane v. Johns-Manville Corp., 843

F.2d 636, 641-42 (2d Cir. 1988); In re El San Juan Hotel, 809 F.2d

151, 154 (1st Cir. 1987); In re L.T. Ruth Coal Co., No. 85-5990, 1986

WL 17769 (6th Cir. Sept. 17, 1986) (unpublished); In re Fondiller,

707 F.2d 441, 442-43 (9th Cir. 1983)); accord In re Coho Energy Inc.

395 F.3d 198, 202 (5th Cir. 2004).

86 F.3d 1232 (D.C. Cir. 1996), this court recognized the “rule

that limits standing to appeal bankruptcy court orders to a

‘person aggrieved,’ ” 86 F.3d at 1234, that is, to one “ ‘whose

rights or interests are ‘directly and adversely affected

pecuniarily’ by the order or decree of the bankruptcy court,’ ”

id. (quoting In re El San Juan Hotel, 809 F.2d 151, 154 (1st Cir.

1987) (quoting In re Fondiller, 707 F.2d 441, 442 (9th Cir.

1983))).6 Without such a limit, we explained, the bankruptcy

courts might be “overwhelm[ed] . . . with claims by the many

parties indirectly affected by bankruptcy court orders.” Id. at

1235 (citing Travelers Ins. Co. v. H.K. Porter Co., 45 F.3d 737,

741 (3d Cir. 1995); Fondiller, 707 F.2d at 443). On appeal,

however, Wolff does not assert he is a “person aggrieved,” as he

did in district court, 391 B.R. at 340-41, but argues instead that

he has standing as a “party in interest.” We disagree. 

Wolff contends that the Bankruptcy Code expressly

authorizes an appeal by one who is a “party in interest” in the

bankruptcy proceeding, relying on 11 U.S.C. § 1109(b), which

provides:

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(b) A party in interest, including the debtor, the

trustee, a creditors’ committee, an equity security

holders’ committee, a creditor, an equity security

holder, or any indenture trustee, may raise and may

appear and be heard on any issue in a case under this

chapter.

On its face, however, this language applies only to “a case under

this chapter,” that is, under Chapter 11 of the Bankruptcy Code,

and Chapter 11 governs only proceedings in the bankruptcy

court, not appeals therefrom. See In re Am. Ready Mix, Inc., 14

F.3d 1497, 1502 (10th Cir. 1994) (“Section 1109(b) says nothing

about a party’s standing to appeal.”); In re PWS Holding Corp.,

228 F.3d 224, 248-49 (3d Cir. 2000) (§ 1109(b) “confers broad

standing at the trial level” but “courts do not extend that

provision to appellate standing”). Consequently, Wolff’s

standing in district court is governed by the rule we recognized

in McGuirl—limiting bankruptcy appeals to “persons

aggrieved”—and Wolff does not challenge the district court’s

conclusion that he was not a “person aggrieved” because his

“rights or interests” were not “directly and adversely affected

pecuniarily” by the order. McGuirl, 86 F.3d at 1234 (internal

quotation omitted). Accordingly, Wolff lacked prudential

standing to appeal the Settlement Approval Order.

For the foregoing reasons, we affirm the judgment of the

district court.

So ordered.

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