# U ni te d S ta te s B an kr up tc y A pp el la te P an el For the Eig hth Circu it

__ __ __ __ __ __ __ __ __ __ __ __ __ _ No. 1 6- 60 11

__ __ __ __ __ __ __ __ __ __ __ __ __ _ In re: Jo hn F. Huo nd er; Ton ni e Jo Huo nd er

ll ll ll ll ll ll ll ll ll ll l Deb to rs

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Jo hn F. Huo nd er; Ton ni e Jo Huo nd er

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff s - Ap pe ll an ts

v.

Ch am pi on Mi lk in g S y st em s, LLC

ll ll ll ll ll ll ll ll ll ll l Defe nd

an t - Ap pe ll ee

__ __ __ __ __ __ App eal fro m

Uni te d S ta te s B an kr up tc y Co ur t fo r th e Dis tri ct of M in ne so ta - St. Pa ul

__ __ __ __ __ __ Su bm it te d: Aug us t 1 2, 2 01 6 Fi le d: Sep te m

be r 29 , 20 16

__ __ __ __ __ __ Befo re SC HERMER, NAIL, an d S HODEEN, Ban kr up tc y Ju dg es

.

__ __ __ __ __ __ NAIL, Ban kr up tc y

Ju dg e.Deb to rs Jo hn F. Huo nd er an d Ton ni e Jo Huo nd er ap pe al th e Feb ru ary 25 , 20 16

jud gm en t of th e ba nk ru pt cy co ur t sa nc ti on in g Ch am pi on M i lk in g Sy st em s, LLC 1 ("C ha m pi on ") fo r vi ol at in g t he di sc ha rg e in jun ct io n. We affi rm

.

BACKGROUND

Deb to rs co m

m en ced an ad ve rs ary pr oc eed in g ag ai ns t Ch am pi on , se ek in g

co m pe ns at or y da m ag es , ge ne ral da m ag es , pu ni ti ve da m ag es , an d at to rn ey fees fo r Ch am pi on 's al le ge d vi ol at io ns of th e di sc ha rg e in jun ct io n. Afte r he ari ng th e m at te r,

2 th e b an kr up tc y

co ur t en te red two ord ers

.

The fir st or de r award ed Deb to rs ge ne ral da m ag es of $1 ,00 0.0 0 fo r Ch am pi on 's vi ol at io n o f t h e di sc ha rg e in jun ct io n an d di rect ed Deb to rs to fil e an it em iz ed
st at e men t o f th ei r at to rn ey fees an d co st s. The se co nd or de r, en te red aft er Deb to rs ha d co m pl ie d wit h th e fir st or de r, award ed Deb to rs at to rn ey f e e s of $1 ,50 0.0 0 fo r Ch am pi on 's vi ol at io n of th e di sc ha rg e in jun ct io n an d di rect ed th e en try of jud gm en t in Deb to rs ' fav or fo r bo th th e ge ne ral da m ag es award ed in th e fir st or de r an d t h e at to r n e y fees award ed in th e se co nd or de r. The ba nk ru pt cy co ur t di d no t award Deb to rs co m

pe ns at or y da m ag es or p un it iv e d am ag es

.

The ba nk ru pt cy cl erk en te red jud gm en t in Deb to rs ' fav or as di rect ed by th e ba nk ru pt cy

co ur t. Deb to rs ti m el y

ap pe al ed

.

Th e Hon or ab le Greg or y F. Kis he l, who ha s si nc e ret ire d bu t was th en Ch ie f 1 Ju dg e, Uni te d S ta te s B an kr up tc y Co ur t fo r th e Dis tri ct of M in ne so ta

. A ba nk ru pt cy di sc ha rg e "o pe rat es as an in jun ct io n ag ai ns t th e co m

m en cem en t 2

or co nt in ua ti on of an act io n, th e em pl oym en t of pr oc es s, or an act , to co ll ect , reco ve r
or of fs et an y su ch de bt as a pe rs on al li ab il it y of th e de bt or , whe th er or no t di sc ha rg e of su ch de bt is waiv ed [.]" 11 U.S.C. § 5 24 (a)( 2)

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-STANDARD OF REVIEW

W e rev ie w th e ba nk ru pt cy co ur t's award of sa nc ti on s fo r an ab us e of di sc ret io n. Mis so ur i Dep't of So c. Se rv s. v. Sp en cer (

In re Sp en cer ), 55 0 B.R. 76 6, 76 9 (B.A.P. 8t h C ir. 2 01 6)

.

A c o ur t ab us es it s di sc ret io n whe n a rel ev an t fact or th a t

s ho ul d ha ve be en gi ve n si gn ifi can t weig ht is no t

co ns id ered ; whe n an irr el ev an t or im pr o p e r fact or is

co ns id ered an d gi ve n si gn ifi can t weig ht ; or w he n all pr op er fact or s an d no im

pr op er on es are co ns id ered , bu t th e co ur t

co m m it s a cl ear erro r of jud gm en t in weig hi ng th os e fact or s.

Ci ty of Dul ut h v. Fon d du La c Ban d of La ke Su pe ri or Ch ip

pe wa , 70 2 F.3 d 11 47 , 11 52 (8 th Cir . 20 13 ).

DISCUSS ION

Deb to rs arg ue th e ba nk ru pt cy co ur t erre d in no t award in g th em al l th e at to rn ey fees th ey in cu rred in th ei r ad ve rs ary pr oc eed in g ag ai ns t Ch am pi on fo r it s vi ol at io n of th e di sc ha rg e in

jun c t i o n

. D e b to rs al so arg ue th e ba nk ru pt cy co ur t erre d in no t award in g th em pu ni ti ve da m ag es fo r Ch am pi on ' s v i o l a ti on of th e di sc ha rg e in jun ct io n. Bo th arg um en ts fai l, for the sa m e reas on : The reco rd on ap pe al affo rd s

us no ba si s fo r ev al ua ti ng th ei r m eri ts

.

Thro ug ho ut th ei r br ie f, Deb to rs m ak e rep eat ed refe ren ces to va rio us ex hi bi ts th at were ad m it te d at th e tri al an d to th e ba nk ru pt cy co ur t's "o ral or de r." The reco rd

on ap pe al , ho wev er, do es no t co nt ai n an y su ch ex hi bi ts or a tra ns cri pt o f an y su ch

or al ord er. W e h av e on ly b een pr ov id ed th e tra ns cri pt of th e tri al , wh ic h en ds wit h th e b an kr up tc y

co ur t's rece ss in g a fte r he ari ng th e p art ie s' c lo si ng arg um en ts

.

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-In it s fir st or de r, th e ba nk ru pt cy co ur t in di cat ed it he ld a co nt in ue d te le ph on ic

he ari ng se ve ral da y s aft er th e tri al an d "m em or ia li ze d i t s de ci si on on th e reco rd by reci ti ng fin di ng s of fact an d co nc lu si on s of la w pu rs ua nt to Fed

. R. Ci v. P. 52 (a) an d Fed . R . B an kr . P . 7 05 2." Pres um ab ly, th is is th e or al or de r t o w h i ch Deb to rs refe r. W e h av e n ot be en pro vi de d a tra ns cri pt of t ha t h eari ng

.

W e are th us un ab le to rev ie w th e ba nk ru pt cy co ur t's fin di ng s of fact or it s

co nc lu si on s of la w. Co ns eq u e n t l y , we can no t sa y th e ba nk ru pt cy co ur t ab us ed it s di sc ret io n in reac hi ng th e de ci si on it di d. Se e Ban k of Neb ra sk a v. Ros e (

In re Ros e ), 48 3 B.R. 54 0, 5 4 4 ( B

. A

. P

. 8t h Ci r. 20 12 ) (wit ho ut a tra ns cri pt , a rev ie win g co ur t

can no t co nc lu de a ba nk ru pt cy co ur t's fin di ng s o f fac t ar e cl earl y erro ne ou s)

.

CONCLUSION

W e th eref

or e affi rm th e ba nk ru pt cy co ur t's Feb r ua ry 25 , 20 16 jud gm en t

sa nc ti on in g C ha m

pi on for vi ol at in g t he di sc ha rg e in jun ct io n.

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