Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-14-00054/USCOURTS-ca10-14-00054-0/pdf.json

Parties Involved:
Gary A. Barney
Appellee
Robert M. Lane
Appellant

Document Text:

FILED

U.S. Bankruptcy Appellate Panel

of the Tenth Circuit

March 20, 2015

Blaine F. Bates

Clerk

NOT FOR PUBLICATION

UNITED STATES BANKRUPTCY APPELLATE PANEL

OF THE TENTH CIRCUIT

IN RE ROBERT M. LANE, also known

as Bob Lane,

Debtor.

BAP No. WY-14-053

BAP No. WY-14-054

ROBERT M. LANE,

Appellant,

Bankr. No. 11-20398

Chapter 7

v. OPINION

*

GARY A. BARNEY, Chapter 7

Trustee,

Appellee.

Appeal from the United States Bankruptcy Court

for the District of Wyoming

Before THURMAN, Chief Judge, MICHAEL, and KARLIN, Bankruptcy Judges.

KARLIN, Bankruptcy Judge.

The Chapter 7 debtor Robert Lane (the “Debtor” or “Lane”) appeals a

bankruptcy court’s order approving a motion to sell coins filed by the Chapter 7

trustee Gary Barney (the “Trustee”) and an order striking Lane’s objection to the

sale. We dismiss the appeals because the completed sale has rendered Lane’s

request for relief moot.

This unpublished opinion may be cited for its persuasive value, but is not

*

precedential, except under the doctrines of law of the case, claim preclusion, and

issue preclusion. 10th Cir. BAP L.R. 8026-6.

BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 1 of 7
I. Background Facts

Lane filed his Chapter 7 bankruptcy in April 2011, commencing a series of

battles with the Trustee over (among other things) asset sales, unscheduled and

undisclosed property, and lawsuits by the Trustee against Lane, his family

members, and family-controlled entities to revoke Lane’s discharge and to

recover assets for the benefit of the estate. The parties reached a ceasefire in June

2013, when the Bankruptcy Court approved two global settlement agreements:

one between the Trustee and Lane family members and family-controlled entities

(the “Family Settlement Agreement”), and one between the Trustee and Lane (the

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“Lane Settlement Agreement”).

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Pursuant to the Lane Settlement Agreement, Lane was allowed to keep

many assets, including a collection of “numismatic” coins. That Settlement

3 4

Agreement also verified that a collection of “bullion coins” would be property of

the estate. Finally, in exchange for retaining significant assets and for being

released from litigation–including an adversary proceeding by the Trustee to

revoke Lane’s discharge–Lane agreed to waive standing in the bankruptcy case,

[Family] Settlement Agreement and Mutual Release, Appellee’s Appendix

1

(“Trustee App.”) at 36.

[Lane] Settlement Agreement and Mutual Release, Trustee App. at 453.

2

The Lane Settlement Agreement allowed Lane to retain pension assets

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valued in excess of $2.5 million, collectibles (books, wine, baseball memorabilia,

numismatic coins), a fountain pen collection, valuable paintings, 3 automobiles,

including a Mercedes Benz, all furnishings and personal property in two homes,

the right to retain possession of and reside in those two homes in California and

Wyoming pending the Trustee’s sale of them, and to cap statutory Trustee fees.

The agreements also required the Trustee to dismiss some avoidance actions

against Lane family-controlled entities. Id. at 456-59.

The Trustee has alleged that both bullion and numismatic coins were not

4

disclosed by Lane on his bankruptcy schedules, and in fact were discovered by

the Trustee or his agents “throughout the house” during an eviction at one of

Lane’s properties. Trustee’s Motion to Sell Estate’s Interest in Bullion Coins

Free and Clear, Appellant’s Appendix (“Lane App.”) at 517-18.

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BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 2 of 7
including standing to object to all future asset sales proposed by the Trustee.

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After the Lane Settlement Agreement was reached, the Trustee filed a

motion (the “Sale Motion”) in August 2014, seeking to sell coins to American

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Rare Coins and Collectibles, an entity to whom the Trustee had previously sold

other coins after receiving Bankruptcy Court approval. The Trustee alleged in the

Sale Motion that he only wished to sell the bullion coins that remained estate

property, and the motion made it abundantly clear that no numismatic coins were

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to be sold as part of this Sale Motion. Lane objected, asserting that the coins

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were in reality numismatic coins, and that they thus belonged to him under the

Lane Settlement Agreement. Lane also argued that the proposed sale violated the

rights of family-controlled entities, who he claimed had some interest in those

coins. The Trustee filed a motion to strike Lane’s opposition, arguing that Lane

Lane Settlement Agreement, Trustee App. at 459-62. Lane’s waiver of

5

standing to object was valuable to the Trustee and the estate, as Lane has filed

numerous objections and other pleadings that have apparently slowed down asset

sales and increased administrative costs for the estate. See, e.g., docket for Case

No. 11-20398 (“Docket”), Lane’s supplemental appendix (“Lane App. 2”) at PDF

pp. 23 (Docket No. 981–Opposition to Trustee’s Motion to Sell Estate’s Interest

in Bullion Coins Free and Clear); 33 (Docket No. 889–Objection to Application

for Writ of Execution for Possession of Real Property); 46 (No. 778–Objection to

Trustee’s Motion to Sell Wilson, Wyoming Property Free and Clear); 60 (Docket

No. 650–Opposition to Trustee’s Motion to Turnover Post-Petition Insurance

Proceeds on Debtor’s Post-Petition State Farm Insurance Coverages); 68 (Docket

No. 589–Opposition to Proposed Sale of Art); 112 (Docket No. 229–Opposition to

Proposed [Family] Settlement).

Trustee’s Motion to Sell Estate’s Interest in Bullion Coins Free and Clear,

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Lane App. at 517.

Testimony concerning a prior coin sale suggests numismatic coins are more

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valuable than bullion coins because the latter trade dollar for dollar in proportion

to the value of their metal content while numismatic coins generally trade 20

percent or more over their metal content value. [Partial] Transcript of

Proceedings, January 16, 2014 (“January 2014 Transcript”), Trustee App. at 199,

206 (testimony of Trustee's expert on prior sale of coins).

The Sale Motion sought authority to sell the bankruptcy estate’s interest in

8

bullion coins to American Rare Coin. Sale Motion, Lane App. at 519-20.

Footnote 1 stated that “Trustee is not seeking to sell any of the Debtor’s personal

property, including any of the numismatic coins.” Id. at 518 n.1 (emphasis in

original).

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BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 3 of 7
had waived his standing to object to the sale when he signed the Lane Settlement

Agreement.

In October 2014, the Bankruptcy Court entered an order striking Lane’s

opposition (the “Strike Order”) and a separate order approving the sale (the “Sale

Order”). The Sale Order expressly provided that the Trustee was authorized to

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sell only bullion coins—not numismatic coins. Lane did not seek a stay of

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either order; instead he filed a “Request for Clarification” of the Sale Order,

which the Trustee opposed. The Bankruptcy Court denied that request. Lane

timely appealed both the Sale Order and Strike Order on October 16, 2014. The

Trustee closed the sale of the coins to American Rare Coins on or about October

27, 2014, realizing $115,282.50 from the sale.

Lane argues on appeal that (a) he has standing to enforce his right to

numismatic coins under the Lane Settlement Agreement; (b) the Bankruptcy Court

is estopped from denying Lane standing to enforce the Lane Settlement

Agreement when the court previously allowed him to enforce it; (c) the

Bankruptcy Court erred in permitting the coin sale without a proper determination

of whether the coins were bullion or numismatic; and (d) the Bankruptcy Court

erred in approving the sale and in the process violated the rights of various third

parties. Lane asks that we overturn the Sale Order and Strike Order. The Trustee

argues that (a) Lane lacks standing to appeal the Strike Order and the Sale Order;

Order Granting Trustee’s Motion to Strike Debtor’s Opposition to

9

Trustee’s Motion to Sell Estate’s Interest in Bullion Coins Free and Clear, Lane

App. at 595; Order Granting Trustee’s Motion to Sell Estate’s Interest in Bullion

Coins Free and Clear, Lane App. at 596.

The Bankruptcy Court made clear that the Trustee had authority to sell only

10

bullion coins, making the point both in the caption of the order (“Order Granting

Trustee’s Motion to Sell Estate’s Interest in Bullion Coins Free and Clear”), Lane

App. at 596 (emphasis added), and in the body of the order (“The Motion seeks

authorization to sell the bankruptcy estate’s interest in bullion coins .... Trustee is

not authorized to sell any numismatic coins.”), id. (underlined emphasis in

original; italicized emphasis added).

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BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 4 of 7
(b) the appeals are moot due to the sale closing; (c) the Bankruptcy Court

committed no error in entering the Sale Order and the Strike Order; and (d)

Lane’s challenges to the Trustee’s authority under the settlement agreements and

settlement orders are barred by res judicata.

II. Jurisdiction

The Court must satisfy itself that it has jurisdiction to hear these appeals.

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In addition to determining whether an order is final or is an appropriate

interlocutory order under 28 U.S.C. § 158(a), we must be sure that the appeal is

not moot. An appeal is moot when the issues are no longer “live” or when the

12

parties lack a legally cognizable interest in the outcome. A controversy is no

13

longer “live” if the appellate court is incapable of rendering effective relief or

restoring the parties to their original position.

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The Trustee argues that Lane’s appeals are both statutorily moot under 11

U.S.C. § 363(m) and equitably moot. We need not decide whether Lane’s appeals

are equitably moot because they are statutorily moot under § 363(m). Section

363(m) provides that reversal or modification on appeal of a bankruptcy sale

order does not affect the validity of the sale to a good-faith purchaser unless the

sale and the sale order were stayed pending the appeal. The sale to American

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Rare Coins has closed. Lane did not seek a stay of the Sale Order or Strike

Order, and he does not argue that American Rare Coins (a neutral third-party

purchaser) is not a good-faith purchaser. The only remaining issue is whether

Egbert Dev., LLC v. Cmty. First Nat’l Bank (In re Egbert Dev., LLC), 219

11

B.R. 903, 905 (10th Cir. BAP 1998).

Id. (citing U.S. Const., art. III, § 2, cl. 1.)

12

Id.

13

Id.

14

11 U.S.C. § 363(m).

15

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BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 5 of 7
§ 363(m) permits the relief Lane seeks on appeal. It does not.

First, § 363(m) applies to both orders because the Sale Order depended in

part on the Strike Order. Second, the only relief Lane seeks is a reversal of the

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Sale Order and Strike Order. Allowing such relief would frustrate § 363(m)’s

19

purpose of promoting finality to bankruptcy sales, which helps protect creditors.

20

While we will attempt to “discern the kernel of the issues” presented by a pro se

party on appeal, we will not assume the role of advocate for that litigant.

21 22

Because the only relief requested by Lane would affect the validity of the coin

sale, Lane’s appeals are moot under § 363(m).

The Trustee also asserts that jurisdiction is lacking because Lane waived

his standing in the case pursuant to the Lane Settlement Agreement. Lane argues,

in contrast, that he has standing to contest the sale of numismatic coins. We need

not decide that issue because the Sale Motion only sought the right to sell bullion

coins, and the Sale Order only granted the Trustee the right to sell bullion

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coins.

24

In re C.W. Mining Co., 740 F.3d 548, 555 (10th Cir. 2014) (concluding that

18

the effect of § 363(m) is not limited to appeals of sale order itself where sale

order depends on other orders on appeal).

Appellant’s Opening Brief at 41 (“RELIEF SOUGHT . . . Debtor requests

19

that the Bankruptcy Appellate Panel, as the appellate court, review the law and

the factual evidence and overturn the lower court’s orders to deny him standing

and to sell the coins. The Appellant prays that the court carefully review matters

and make a just decision.”).

C.W. Mining Co., 740 F.3d at 555.

20

de Silva v. Pitts, 481 F.3d 1279, 1283 n.4 (10th Cir. 2007).

21

Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991).

22

Sale Motion, Lane App. at 518 n.1 (confirming that Trustee was “not

23

seeking to sell . . . numismatic coins.”).

What Lane really appears to contest is the Trustee’s right to sell the

24

numismatic coins that Lane is entitled to retain under the Lane Settlement

Agreement. The Sale Order provides that all interests in the coins shall attach to

(continued...)

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BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 6 of 7
III. Conclusion

For the reasons stated above, Lane’s appeals are DISMISSED as moot.

(...continued)

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the sale proceeds. Sale Order, Lane App. at 596. If Lane could establish that the

coins sold were in fact numismatic coins, he may have the personal right to assert

his interest in the proceeds. He would not have the right to assert the interests of

third parties, such as Windriver Corp. of WY, LLC, because Lane has no standing

to argue third-party rights. See Aid for Women v. Foulston, 441 F.3d 1101, 1111

(10th Cir. 2006) (recognizing general standing limitation in federal courts that a

litigant will ordinarily not be permitted to assert the rights of absent third parties).

Lane also expressly waived any “right” he might claim to assert standing on

behalf of others when he signed the Lane Settlement Agreement.

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BAP Appeal No. 14-54 Docket No. 34 Filed: 03/20/2015 Page: 7 of 7