United State s District Judge, WesternDistrict of Texas, sitting bydesignation. * 

### INTHE UNI TED S TATESCOU RT OFAPPEALS

FORTHEFIFTH CIRCU IT

No s . 0 8

- 3 0 3 4 1 & 08- 30343

In th e M a tte r o f: CA NOC O I NC; MERF I N I NC ; MI NORA CO RP ORAT I ON I NC D e b t o r s
AV RAM C I M ER RI NG A p p ell a n t v. O RI X C AP I TA L M AR K ET S, LLC , as s pe c i als e rvi c e rf o rW e l l s Far go Bank N A , T ru stee, al so k n ow n as W ell s F a rg o B a n kN A , as tru stee for certif i ca te hol der s und ert hatc er t ai n pooli ng s ervi c e a gr ee m entdat ed and e f fec t ive 1 1 / 1 / 9 9 , r e l a t e dt o t h e mo r t g a g e p a s s - t h r o u g h c e r t i f i c a t e s s e r i e s 1 9 9 9

- C1 A pp el l ee
A p p ea lf

rom the U n i tedS tates D i stri ct C ou rt f ort he W es t er n D i st r i c tof Loui si ana U SD C N o. 5: 07- C V

- 670

B ef ore JO N E S , C h i ef Ju dg e, JO L LY , C i rcui t Ju dg e, an d M O N T A L V O , D i st ri ct J u d g e . * United States Court of App eals Fifth Circuit 

### F I L E D April14, 2009 Cha rl es R. F ulb ru g e II I ClerkN os . 08- 30341 & 08- 30343

Pursuant to 5 T H C IR . R . 47 .5, the court has determined that this opinion should not ** be publishe d and is not precedent exceptunder the limited circu mstance s set forthin5 T H C IR . R. 47.5 .4. 2 E D ITH H

. JO N E S , C h i ef Ju dg e: ** T o d a te Av r a m C im e r r in g h a s n o t m a d e a p a y m e n t on th e a p p r o x im a te ly $6

. 6 m i l l i o n, pl us i nt e r e s t , he o w e s o n a 20 03 Vi r gi ni a de f i c i en cy j udg m e nt
ar i s i ng f

r o m hi s gua r ant e e o f a de fault e d m o r t ga ge . The m o r t ga ge i s he l d i n a
s e c u r itiz e dp o o l o f m o r tg a g e s fo rw h ic h W e lls F a r g o is th e tr u s te e a n dO R IX is t h e speci alservi cer. P artof O R IX ’ s d u t i es i n tha trol e is to c ol l ecton d efau l t ed l o ans . To t hi s e nd, O RI X at t e m pt e d t o co l l e c to n t hi s j udg m e ntb y s ui ng Ci m e r r i ng, hi s w i fe , Ci ndy , a nd thr e e e nt i t i e s w ho l l y o w ne d byCi ndyCi m e r r i ng in L o u is ia n aco u r t. T h e t h r e e e n tit ie s , C a n o c o , In c ., M in o r aC o r p o r a tio n , In c ., andM e r f

i n, I nc . (D e bt o r s ) , f

i l e d Chap t e r1 1 c o ns o l i da t e d b ank r upt c y c a s e s in t he W es t er n D i st r i c tof

Loui si ana i n Jul y 2006 , and t he s t at e c our t li ti ga t i on w as s ta y e d

. O R IXf i l ed a p roof

of cl ai m on beh al f

of t h e T rust i n t h e ban kru ptcy pr o c e e di ngs . Av r am Ci m e r r i ng o bj e c t e d a nd m o ve d f o rs um m ar y j udg m e nt
. The Tr us tf i l e d ac r o s s m o t i o n f o rs um m ar y j udg m e nt
. Ci m e r r i ng argu ed t hatt he j u d gm en t a ga i n st h i m i s n ot r e s j udi c at a anda s s e r t e d v ar i o us r e as o ns w hy t he j u dg m en tshou l d be d i sregarded or redu ced. Treati n g t h ese m ot i on s as a con testedm a tter, the ba n k ru p tcy cou rt all ow ed the T ru st’ s cl a i m , gra n tedi ts
m ot i on f

or s u m m ary j u dg m en t , an d d en i ed C i m erri n g’ s m ot i on f or s u m m ary j u dg m en ti n t h ree i den t i calorders n u m bered 22 9, 230 , an d 23 1. Th e court rul ed t h e j u dg m en tagainstC im e rri n g i s re s ju d ica taa n d , a lte r n a tiv e ly , th a t h is
ar gum e nt s r e ga r di ng w hy he i s no tl i ab l e o n t he j udg m e nta r e w rong o n t he
m er i t s. C i m er r i ng appeal s t hes e t hre e or der s i n t he appea lnum ber ed 08

- 30341.N os . 08- 30341 & 08- 30343

3 Th e D ebt or s and t he f i r stm or t gage e al so f

i l ed obj ec t i ons . I n an addi t i onal order nu m bered 22 6, th e b an kru ptcy c ou rtgran t ed i npart an d d en i ed i n part t h ese obj ect i on s, subord i n ati n g t h e T rust’ s cl ai m t o both secured an d u n secured
c r edit or s and es t i m at i ng t he c l ai m ’ s val ue f orvo t i ng pu rp ose s duri ng pl an con f i r m at i on. Ci m er r i ng al soappeal s t hi s or deri n t he appea lnum ber ed 08

- 30343. O n appe al , t he di s t r i c tc o ur ta f f i r m e d b o t h o f

t he s e o r de r s o n t he g r o unds st ated oral l y by t h e ban kru ptcy c ou rt
. I n app ealN o. 08-30341 , C i m erri n g rai ses, i n e s s e n c e , f

o u r i s s u e s . W e n e e d a d d r e s s o n l yt wo i s s u e s , h o we v e r , b e c a u s e we do no tr e ac h t he o t he rt w o m e r i t s - r e l at e d c o nt e nt i o ns . Fi r s t , he ar gue s t hatt he ba nkr upt c y c o ur tdi d no thav e t he a ut ho r i t y t o g r ants um m ar y j udg m e nto ut s i de
o f a n a dv e r s ar y pr o c e e di ng. W e r e vi e w t he b ank r upt c y c o ur t ’ s ap pl i c at i o n o f t he b a n k r u p tc yru le s fo rh a r m le s s e r r o r . I n reT ex . Ext r us i o n Cor

p. , 844 F. 2d 1142, 1 1 5 3 -5 4 (5 th C ir . 1 9 8 8 ). T h e b a n k r u p t c y c o u r t d id n o t e r r . C im e r r in g ’s o bje c t io n t o t h e T r u s t ’s pr o o f o f c l ai m , a l t ho ughi tdi d no ti ni t i at e a n a dv e r s ar y pr o c e e di ng, c r e at e d a
c o n te s te dm a tt e ru n d e rB a n k r u p tc yR u le 9 0 1 4
. S eeN ot es t o Bank r . R

. 3007. B an kru ptcy c ou rt s c an render sum m ary j u dg m en tin con t est ed m att ers. B an kr. R . 9 0 1 4 (c ) (in c o r p o r a tin gB a n k r . R . 7 0 5 6 ). S eco n d , C i m errin g a sse rts th a t th e V i rg i n i aj u d gm en t i s n ot re s ju d ica ta
a ga i n st h i m . If

i t i s n ot re s ju d ica taagai nsthi m , th e j u d gm en tw oul d notbe pr e c l us ivea ga i ns tt he de bt o r s . W e a pply t he s am e s t and ar ds o f r e vi e w t he di st r i c tc our tappl i ed t o the bankr upt c y court ’ s r ul i ng by r evi ew i ng fac t ual f i n d i n g s fo rc l e a re r r o ra n dq u e s t i o n s o f l a w de no vo . In re O C A , I n c. , 551 F. 3d 3 5 9 , 36 6 ( 5 th C i r. 20 0 8 ). F ed era lcou rts ap p l y th e p rec lu s io n l a w of th e sta te th a t r e n d e r e dju d g m e n t. Mar r e s ev . Am

. Ac ad. of O r t ho pae di cSurge o ns , 4 7 0 U .S . 3 7 3 , 3 8 0 , 1 0 5 S . C t. 1 3 2 7 , 1 3 3 2 (1 9 8 5 ); Conn. B ank of Com m e r c ev. R e publ i cof

Congo , 3 0 9 F .3 d 2 4 0 , 2 4 8 ( 5 t h C i r . 2 0 0 2 ); see28 U

. S. C

. § 1738.N os . 08- 30341 & 08- 30343

4 A ccor di n gl y, V i rgi n i a precl u si on l aw ap pl i es t o t h e def i ci en cy j u dg m en tagainst Ci m e r r i ng r e nde r e d i n a V i r gi ni a s t at e co ur t
. U nde rVi r gi ni a l aw, aj udg m e nt i s re s ju d ica ta if “t h e p r io r a dju d ic a tio n w a s b e tw e e n th e s a m e p a r tie s o rth e ir p rivies a n da v a l i df

i n a lj u d gm en t w a s en tered w h i ch reso lve dth e cl a i m on i ts
m erits. ” W

at e rf ro nt Mar i ne Cons t r . , I nc . v . N

. End 49e rs Sandb r i dgeBulkhe ad G ro upsA, B, andC , 4 6 8 S .E .2 d8 9 4 , 9 0 2 (V a . 1 9 9 6 ). O n Ju n e 26, 200 2, a V i rgi n i a court f ou n d C i m erri n g persona l l y l i able on t h e defaul t ed m ort gag e. O n F ebru ary 18, 200 3, t h e court en t ered a d e fici en cy j udg m e nt , w hi c h Ci m e r r i ng di d n ota ppe al

. Thi s w as af i nalj udg m e nto n t he
m e r its , a n d u n d e rV ir g in iala w , aju d g m e n t, w h e n e n te r e da n dn o a p p e a l is ta k e n , is c o n c lu s iv e e v e n if e r r o n e o u s . Patt ers on v. S au n d ers , 74 S. E

. 2d 204, 207 (V a . 1 9 5 3 ); S lag le v

. S lag le , 3 9 8 S .E .2d 3 4 6 , 3 4 9 (V a . C t. A p p . 1 9 9 0 ). U n d e rce r ta in cir c u m s ta n c e s , fin a l ju d g m e n ts m a yb e s e t a s id e . S ee Ch arles v. Prec i si on Tu n e, I n c. , 414 S. E

. 2d 831 (V a. 1992)

. I n Sept em ber2005, C i m erri n g f

i l ed a sepa rat e sui ti n V i rgi n i a seeki n g t o setasi de the defi ci en cy j udgm ent , and on M ay 3, 2006, t he t r i al c our t deni ed r eli ef

. C i m er r i ng’ s appeal t o t he Vi r gi ni a Supr e m e Cour t w as gr ant e d and a de c i s i o n w as s t i l lpe ndi ng
w h e n th e b a n k r u p tc yco u r t r u le dinF e b r u a r y2 0 0 7
. C im e r r in gcla im s th is gran t ed ap pea lrenders t h e ori gi n alj u dg m en tn o t f i n al

. H e i s w rong, becau se a j u d gm en t i s en titl edto p r e c lu s iv e e ffe c t u n til itis s e t a s id e . May e s v . Mann , 180 S. E

. 425 , 430 (V a. 193 5 ) c ite din 8 B M ic h ie ’ s J u r is p r u d e n c e , F orm er A d ju d ica tion o r R es Ju d ica ta§ 1 0 , (2 0 0 7 ). I n any event , on Sept em ber14, 2007, t h e V i rgi n i a S u prem e C ou rtden i ed C i m erri n g rel i ef i n an un pu bl i shed order. Th e o r i gi naldef

i c i enc y j udgm enti s t her ef or e unques t i onably re s ju d ica ta
a g a i n s tCi m e r ri n g. Con s e que nt l y, w e a f f i r m t he di s t r i c tc o ur t ’ s a f f i r m anc e o f

t he b a n k r u p c t yc o u r t ’s o r d e r s n u m b e r e d2 2 9 , 2 3 0 , a n d2 3 1 a p p e a le din th is c o u r t ’s N o. 08-30341
. B ecau se r e s ju d ica tap r o t e c t s e v e n e r r o n e o u s j u d g me n t s , we de c l i ne t o addr e s s ye ta no t he ra t t e m ptt o s e ta s i de t hi s de f i c i e nc y j udg m e nt , a ndN os . 08- 30341 & 08- 30343

5 a c c o r d i n gly , wed on o ta d d r e s s Ci m e r r i ng’ s s ubs t ant ive a r gum e nt s r e ga r di ng t he j udgm ent ’ s al l ege d i nf i r m i t y. In t h e a pp ealnu m bered 08

- 303 43, C i m erri n g ap pea l s t h e order nu m bered 22 6, i n whi c h t he b ank r upt c y c o ur tr ul e d o n o bj e c t i o ns t o cl ai m s f i l e d b y t he D ebtor s and t h e f

i rstm ort ga g e e an d O R IX ’ s opposi t i on t o t h ose obj ect i on s. C i m erri n g does n ot h ave s t an di n g t o assert t h e ri gh t s of th ese un rel ated parti es. Se eBondsv . Tandy , 457 F

. 3d409 , 416 n. 11 ( 5t h Ci r . 2 00 6)

. Con s e que nt l y, t he ap pe alnum be r e d 0 8- 30 34 3 i s di s m i s s e d f o rl ac k o f

j ur i s di c t i o n. Fo rt h e f

o r e g o i n gr e a s o n s , t h e a p p e a ln u m b e r e d0 8

- 3 0 3 4 1 i s AF FI RM ED
a n dt h e a p p e a ln u mb e r e d0 8

- 3 0 3 4 3 i s DI S M I S S ED

.