Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_23-cv-00210/USCOURTS-azd-2_23-cv-00210-3/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1441 Petition for Removal- Breach of Contract

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Robert Rozich,

Plaintiff,

v. 

MTC Financial Incorporated, et al.,

Defendants.

No. CV-23-00210-PHX-DWL

ORDER 

On May 2, 2024, Plaintiff filed a notice of bankruptcy filing, informing the Court 

that Plaintiff “has filed a bankruptcy petition in the United States Bankruptcy Court, for 

the District of Arizona, thereby invoking the provisions of the Automatic Stay under § 362 

of the Bankruptcy Code, 11 U.S.C. § 362.” (Doc. 52 at 1.) Plaintiff “requests this Court 

stay this matter.” (Id. at 2.)

A petition for bankruptcy “operates as a stay” as to, inter alia, “the commencement 

or continuation . . . of a judicial, administrative, or other action or proceeding against the 

debtor that was or could have been commenced before the commencement of the case 

under this title, or to recover a claim against the debtor that arose before the 

commencement of the [bankruptcy case].” 11 U.S.C. § 362(a)(1) (emphasis added). “The 

policy behind § 362 is to protect the estate from being depleted by creditors’ lawsuits and 

seizures of property in order to provide the debtor breathing room to reorganize.” In re 

Palmdale Hills Prop., LLC, 423 B.R. 655, 663 (B.A.P. 9th Cir. 2009).

“Although the scope of the automatic stay is broad, it does not stay all proceedings. 

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. . . [T]he automatic stay has been found inapplicable to lawsuits initiated by the debtor.”

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Id. See also In re Palmdale Hills Prop., LLC, 654 F.3d 868, 875 (9th Cir. 2011) (“The 

[automatic] stay does not prevent a plaintiff/debtor from continuing to prosecute its own 

claims nor does it prevent a defendant from protecting its interests against claims brought 

by the debtor. This is true, even if the defendant’s successful defense will result in the loss 

of an allegedly valuable claim asserted by the debtor.”) (citation omitted); In re Merrick, 

175 B.R. 333, 338 (B.A.P. 9th Cir. 1994) (“While it is true that a successful defense to a 

lawsuit eliminates its alleged value, this results in no loss to the estate, as . . . [t]here can 

be no loss of what does not exist.”).

There is no automatic stay of this action, nor has Plaintiff provided any alternative 

grounds in support of his request to stay this matter.

Accordingly,

IT IS ORDERED that Plaintiff’s request to stay this action (Doc. 53) is denied.

IT IS FURTHER ORDERED that the deadline for First Citizens Bank & Trust 

Company to file a reply brief in support of its motion to dismiss (Doc. 50) is sua sponte

extended one business day, from today, May 3, 2024, to Monday, May 6, 2024.

Dated this 3rd day of May, 2024.

1

In “cases in which the debtor and the adverse party have claims against one 

another,” “some actions may be stayed, others not.” Parker v. Bain, 68 F.3d 1131, 1137 

(9th Cir. 1995). Here, there are no counterclaims, cross claims, or third-party claims—i.e., 

no claims against the debtor or the estate.

Case 2:23-cv-00210-DWL Document 54 Filed 05/03/24 Page 2 of 2