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IN THE UNITED STATES DISTRICT COURT 

FOR THE WESTERN DISTRICT OF PENNSYLVANIA 

ERNEST SMALIS, ) 

 ) 

 Plaintiff, ) 

 ) 

v. ) 

 ) 

CITY OF PITTSBURGH SCH. DIST., ) Civ. A. No. 15-1489 

CITY OF PITTSBURGH LAW DEP’T, )

ALLEGHENY CNTY. LAW DEP’T, and )

CNTY. BD. OF PROP. ASSESSMENT )

APPEAL & REVIEW, ) 

 ) 

 Defendants. ) 

MEMORANDUM OPINION

CONTI, Chief District Judge 

I. INTRODUCTION

 Pending before the court is a motion to withdraw the reference of an adversary

proceeding from the bankruptcy court filed by pro se plaintiff Ernest Smalis (“plaintiff”)

pursuant to 28 U.S.C. § 157(d). (ECF No. 1.)1

 Defendants the City of Pittsburgh School 

District, the City of Pittsburgh Law Department, the Allegheny County Law Department, 

and the Allegheny County Board of Property Assessment, Appeal, and Review 

(collectively, “defendants”) filed a joint response opposing plaintiff’s motion. (ECF No. 

3.) Plaintiff filed a reply to defendants’ joint response. (ECF No. 4.) Having been fully 

briefed, plaintiff’s motion is ripe for disposition. For the reasons set forth in this 

memorandum opinion, the court will deny plaintiff’s motion.

 

1 Unless a different case number is specified, all “ECF” citations correspond to the 

docket in civil number 15-1489. 

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II. BACKGROUND 

On September 2, 2005, debtor Despina Smalis (“debtor”) voluntarily filed a 

Chapter 7 bankruptcy petition in the bankruptcy court. (Bankr. No. 05-31587, ECF No. 

1.) 

 On November 19, 2013, plaintiff filed a civil action against defendants in this 

court at civil number 13-1646 (the “13-1646 civil action”). (Civ. No. 13-1646, ECF No. 

1.) Plaintiff commenced the 13-1646 civil action pursuant to 42 U.S.C. § 1983 and 

alleged defendants violated his constitutional rights by over-taxing his property and 

failing to mail local tax-assessment notices to him while he was incarcerated. (Id.) On 

May 16, 2014, the court issued an opinion and order in the 13-1646 civil action 

dismissing plaintiff’s claims for want of federal subject-matter jurisdiction. (Civ. No. 13-

1646, ECF No. 32); Smalis v. Allegheny Cnty. Bd. of Prop. Assessment, Appeal & 

Review, No. 13-1646, 2014 WL 2039964 (W.D. Pa. May 16, 2014) (concluding that the 

Tax Injunction Act, 28 U.S.C. § 1341, divested the court of jurisdiction over plaintiff’s 

claims). On June 12, 2014, plaintiff appealed the court’s May 16, 2014 opinion and order 

in the 13-1646 civil action to the United States Court of Appeals for the Third Circuit. 

See (Civ. No. 13-1646, ECF No. 34.) Resolution of plaintiff’s appeal is still pending. See

Smalis, App. No. 14-3013 (3d. Cir.). 

 On September 10, 2015, plaintiff commenced an adversary proceeding against 

defendants in the bankruptcy court at adversary number 15-2182 (the “15-2182 adversary 

proceeding”). See (Bankr. No. 05-31587, ECF No. 270); (Adversary No. 15-2182, ECF 

No. 1.) Plaintiff’s § 1983 claim in the 15-2182 adversary proceeding duplicates the § 

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1983 claim plaintiff brought in the previously-dismissed 13-1646 civil action. See

(Adversary No. 15-2182, ECF No. 1 (alleging due process violations stemming from 

local property tax assessment and notification procedures). 

 On October 22, 2015, plaintiff filed the instant motion to withdraw the reference 

of the 15-2182 adversary proceeding from the bankruptcy court to this court, pursuant to 

28 U.S.C. § 157(d). (ECF No. 1.) 

III. DISCUSSION

“[D]istrict courts ‘have original but not exclusive jurisdiction of all civil 

proceedings arising under title 11 or arising in or related to cases under title 11,” i.e., the 

United States Bankruptcy Code. United States v. Delfasco, Inc., 409 B.R. 704, 706 (D. 

Del. 2009) (quoting 28 U.S.C. § 1334(b)). The court may provide that “any or all cases 

under title 11 and any or all proceedings arising under title 11 or arising in or related to a 

case under title 11 shall be referred to the bankruptcy judges for the district.” 28 U.S.C. § 

157(a). The court may withdraw the reference from the bankruptcy court pursuant to the 

mandatory or discretionary withdrawal provisions set forth in 28 U.S.C. § 157(d). See, 

e.g., Nw. Inst. of Psychiatry, Inc. v. Travelers Indem. Co., 272 B.R. 104, 107 (E.D. Pa. 

2001). 

A. Mandatory withdrawal 

Pursuant to § 157(d)’s mandatory withdrawal provision, the court “shall, on timely 

motion of a party, . . . withdraw a proceeding if the court determines that resolution of the 

proceeding requires consideration of both title 11 and other laws of the United States 

regulating organizations or activities affecting interstate commerce.” 28 U.S.C. § 157(d) 

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(emphasis added). A “literal interpretation” of § 157(d)’s mandatory provision “could 

result in an ‘escape hatch’ through which most bankruptcy matters could routinely be 

removed to the district court.” Delfasco, Inc., 409 B.R. at 707 (quoting In re Quaker City 

Gear Works, Inc., 128 B.R. 711, 713 (E.D. Pa. 1991)). For this reason, district courts 

within the Third Circuit have held that § 157(d)’s mandatory provision applies “only 

where the action requires a ‘substantial and material’ consideration of federal law outside 

the Bankruptcy Code.” Id. (quoting In re Continental Airlines, 138 B.R. 442, 444–46 (D. 

Del. 1992)). The movant bears the burden of demonstrating that the proceeding at issue 

requires “a substantial and material consideration of [federal law] outside the Bankruptcy 

Code.” Id.

 Plaintiff did not identify, and the court cannot discern, circumstances warranting 

the application of § 157(d)’s mandatory withdrawal provision in this case. “[R]esolution 

of” the 15-2182 adversary proceeding would not require this court to engage in 

“substantial and material consideration,” Delfasco, Inc., 409 B.R. at 707, of both the 

Bankruptcy Code and federal law “regulating organizations or activities affecting 

interstate commerce.” 28 U.S.C. § 157(d) (emphasis added.) Plaintiff’s allegations in the 

15-2182 adversary proceeding relate solely to whether a local property taxing-body’s

assessment notification and collection procedure—as applied solely to a local resident 

and his local real property—violated plaintiff’s federal constitutional right of due process. 

Plaintiff does not allege local property taxing-bodies discriminated against, or otherwise 

acted to affect, interstate commerce in any manner. C.f. Camps Newfound/Owatonna, Inc. 

v. Town of Harrison, 520 U.S. 564, 574–75 (1997) (“A State’s ‘power to lay and collect 

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taxes, [including state real estate taxes,] . . . cannot be exerted in a way which involves a 

discrimination against [interstate] commerce.” (quoting Pennsylvania v. West Virginia, 

262 U.S. 553, 596 (1923))). Plaintiff’s allegations, therefore, appear to implicate only 

intrastate matters. Consequently, § 157(d) does not apply, and mandatory withdrawal is 

not appropriate in this action. 

 B. Discretionary withdrawal

 Pursuant to § 157(d)’s discretionary withdrawal provision, the court “may

withdraw, in whole or in part, any case or proceeding referred [to the bankruptcy court] . . 

. on timely motion of any party, for cause shown.” 28 U.S.C. § 157(d) (emphasis added); 

In re Pruitt, 910 F.2d 1160, 1168 (3d Cir. 1990). Section 157(d)’s discretionary provision

“requires in clear terms that cause be shown before the reference can be withdrawn” from 

the bankruptcy court. In re Pruitt, 910 F.2d at 1168. The Bankruptcy Code does not 

define “cause” under § 157(d), but the Third Circuit Court of Appeals has indicated that

“[t]he district court should consider the goals of promoting uniformity in 

bankruptcy administration, reducing forum shopping and confusion, 

fostering the economical use of the debtors’ and creditors’ resources, and 

expediting the bankruptcy process.”

Id. (quoting Holland Am. Ins. Co. v. Succession of Roy, 777 F.2d 992, 999 (5th Cir. 

1985)). Importantly, discretionary withdrawal is the “exception to the general rule that 

bankruptcy proceedings should be adjudicated in the bankruptcy courts,” and withdrawal 

is to be “reserved for the unusual circumstance” in which it is “essential to preserve a 

higher interest.” BANKRUPTCY LAW MANUAL § 2:11 (5th ed. 2015) (citing decisions)

(internal quotation marks omitted); accord Irvin v. Faller, 531 B.R. 704, 706 (W.D. Ky. 

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2015). The district court’s decision to grant or deny discretionary withdrawal is 

“committed to the sound discretion of the district court.” BANKRUPTCY LAW MANUAL § 

2:11 (5th ed. 2015) (citing decisions). 

 Plaintiff did not show, and the court cannot discern circumstances demonstrating, 

“cause” for discretionary withdrawal of the 15-2182 adversary proceeding in this case. 

 First, withdrawal of the 15-2182 adversary proceeding would undermine—rather 

than—“promot[e] uniformity” in this bankruptcy action’s administration. In re Pruitt, 

910 F.2d at 1168. The bankruptcy court has presided over debtor’s bankruptcy 

proceeding for more than ten years. Certain of plaintiff’s ancillary contentions in the 15-

2182 adversary proceeding relate to plaintiff’s alleged legal relationship with debtor and 

to the bankruptcy estate. Plaintiff points to matters involving the bankruptcy court’s 

expertise and experience. See, e.g., (Adversary No. 15-2182, ECF No. 1 (alleging, for 

example: (1) the bankruptcy court has jurisdiction over plaintiff’s “tax dispute” because 

“a debtor’s agreement to pay the tax liability of a non-debtor renders the tax dispute 

related to the bankruptcy case”; (2) the bankruptcy trustee failed to disclose to bidders 

that the property at issue was “contaminated” and “condemned”; and (3) the local “taxing 

bodies misapplied . . . payments from the trustee”).) Given the bankruptcy court’s 

experience and expertise in this case, these factors counsel in favor of denying plaintiff’s 

motion. 

 Second, withdrawal of the 15-2182 adversary proceeding would generate—rather 

than “reduce”—“confusion” in this case. In re Pruitt, 910 F.2d at 1168. As stated, 

plaintiff’s § 1983 claim in the 15-2182 adversary proceeding duplicates the § 1983 claim 

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plaintiff asserted in the 13-1646 civil action. In the 13-1646 civil action, another judge in 

this district dismissed plaintiff’s § 1983 claim for want of jurisdiction, and plaintiff 

appealed that decision to the Third Circuit Court of Appeals. Plaintiff’s appeal is

currently pending. In his motion for withdrawal of the 15-2182 adversary proceeding, 

therefore, plaintiff impliedly asks this court to reexamine his § 1983 claim, 

notwithstanding that: (1) that same § 1983 claim was already dismissed in the 13-1646 

civil action; and (2) the Third Circuit Court of Appeals is currently reviewing the 

decision to dismiss plaintiff’s § 1983 claim. In light of the procedural postures of these 

matters, granting plaintiff’s request would generate confusion for the parties, the 

bankruptcy court, the appellate court, and this court. These factors counsel in favor of 

denying plaintiff’s motion. 

Third, withdrawal of the 15-2182 adversary proceeding would impede—not 

“expedite”—the “bankruptcy process” in this case, thereby frustrating—rather than 

“fostering”—the “economical use of the debtors’ and creditors’ resources.” In re Pruitt, 

910 F.2d at 1168. Plaintiff’s motion has already delayed the prompt resolution of this

bankruptcy proceeding. After plaintiff filed his complaint (and several amendments 

thereto) in the 15-2182 adversary proceeding, the bankruptcy court scheduled a hearing 

for November 12, 2015, concerning: (1) subject-matter jurisdiction; (2) whether 

plaintiff’s claims are the “subject matter of an action proceeding in another forum”

(presumably, the Third Circuit Court of Appeals); (3) whether plaintiff’s claims have 

been resolved by another court order; (4) standing; and (5) whether plaintiff should be 

sanctioned for “repetitively fil[ing] complaints, motions, and various other documents in 

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an attempt to raise matters which were previously resolved.” (Adversary No. 15-2182, 

ECF No. 13.) In advance of the scheduled hearing, defendants filed motions to dismiss 

plaintiff’s complaint in the 15-2182 adversary proceeding. See (Adversary No. 15-2182, 

ECF No. 38, 39, 41, 42.) In light of plaintiff’s October 22, 2015 motion to withdraw the 

reference of the 15-2182 adversary proceeding, however, the bankruptcy court cancelled 

the November 12, 2015 hearing and held “all matters to be addressed at that hearing . . . 

in abeyance” pending this court’s resolution of the instant motion. (Adversary No. 15-

2182, ECF No. 34.) In light of these circumstances, and plaintiff’s failure otherwise to 

show cause, the court concludes that withdrawal of the 15-2182 adversary proceeding 

would further interfere with the prompt resolution of this bankruptcy proceeding. 

Withdrawal would, moreover, waste the parties’ and the courts’ time and resources. 

These factors counsel in favor of denying plaintiff’s motion.

 Based upon the foregoing analysis, the court will exercise its discretion and deny 

plaintiff’s motion to withdraw the reference of the 15-2182 adversary proceeding. 

V. CONCLUSION

 For the reasons set forth in this memorandum opinion, the court will deny 

plaintiff’s motion to withdraw the reference of the 15-2182 adversary proceeding from 

the bankruptcy court pursuant to 28 U.S.C. § 157(d). An appropriate order will follow. 

DATED: January 11, 2016 

/S/ JOY FLOWERS CONTI

 Joy Flowers Conti 

 Chief United States District Judge 

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CC: 

 

 ERNEST SMALIS 

 6652 Northumberland Street 

 Pittsburgh, PA 15217 

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