[ DO NOT PUBLISH] 

## In the 

# United States Court of Appeals
For the Eleventh Circuit

____________________

No. 22

- 13591

Non

- Argument Calendar

____________________

In re : SEVEN STARS ON THE HUDSON CORPORATION,
Debtor,

___________________________________________________ SEVEN STARS ON THE HUDSON CORPORATION, d.b.a. Rockin ’ Jump

Plaintiff

- Counter Defendant

- Appellant,

versus
MDG POWERLINE HOLDINGS, LLC, XBK MANAGEMENT LLC, d.b.a. Xtreme Action Park, USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 1 of 162 Opinion of the Court 22

- 13591

Defendants

- Appellees.

____________________ Appeal from the United States District Court for the Southern District of Florida D.C. Docket No. 0:22

- cv

- 60299

- RAR

____________________

Before L AGOA , B RASHER , and B LACK , Circuit Judges.

PER CURIAM : Seven Stars on the Hudson Corporation (Seven Stars) appeals from the bankruptcy court’s grant of summary judgment for MDG Powerline Holdings, LLC (MDG) and XBK Management, LLC (XBK). Seven Stars filed for Chapter 11 bankruptcy, and this appeal arises from a related adversary proceeding in which Seven Stars alleged MDG and XBK interfered with its business. Seven Stars had trouble funding its adversary proceeding litigation, leading to delays in discovery and mis sing the expert disclosure deadline. After t he bankruptcy court refused to further extend expert discovery deadlines , it found Seven Stars had failed to present competent evidence on damages , warranting summary judgm ent for the defendants . On appeal, Seven Stars contends the bankruptcy court erred by refusing to extend the expert discovery deadline s

. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 2 of 1622

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After careful review, like the district court, we affirm the bankruptcy court’s decision. 1

I . BACKGROUND

Seven Stars began operations in 2016 as a trampoline park within Xtreme Action Park, an indoor entertainment facility. Xtreme Action Park is operated by XBK in a building owned by MDG. XBK and MDG are allegedly owned and controlled by the same principals.

In J une 2019, Seven Stars filed a Chapter 11 voluntary petition and , shortly after, an adversary proceeding against MDG and
XBK. From March to June 2020, Seven Stars was forced to close because of a COVID shutdown , exacerbating Seven Stars’ financial troubles

. In May 2020, several months after Seven Stars filed its first amended adversary complaint, Legalist , a litigation funder, approached Seven Stars about providing funding for the adversary proceeding litigation, but they could not reach an agreement at

t hat time.

1 As the second court of review in a bankruptcy case, we “examine[] independently the factual and legal determinations of the bankruptcy court and employ[] the same standards of review as the district court.” In re Brown , 742 F.3d 1309, 1315 (11th Cir. 201 4) (quotation marks omitted). “ [W] hen a district court affirms a bankruptcy court ’ s order, as the district court did here,” we look to the bankruptcy court’s decision, reviewing its factual findings for clear error and its legal conclusions de novo

. Id. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 3 of 164 Opinion of the Court 22

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Over the next few months, Seven Stars filed its first set of Rule 26(a)(1) initial disclosures in the adversary proceeding and elected to proceed under Subchapter V in the main bankruptcy proceeding

. T he main bankruptcy proceeding was dismisse d in August 2020 because a Subchapter V plan was not timely filed, and Seven Stars filed a new Chapter 11 Subchapter V petition shortly after . The adversary proceeding was allowed to continue. Proceedings picked up i n November 2020 . First, t he bankruptcy court entered an agreed scheduling order in the adversary proceeding , setting the deadline for the parties to complete fact discovery in January 2021; exchange expert witness summaries and
reports 2 in February 2021; and complete expert disco very in March

2021. Seven Stars then timely requested leave to file a second amended adversary complaint. A couple of weeks later, XBK

serve d written interrogatories on Seven Stars regarding damages and expert witnesses , and MDG filed a claim in the main bankruptcy proceeding for over $230,000 in unpaid rent, late fees, taxes, and legal fees. Around this time, Legalist again approached Seven Stars about a litigation funding agreement.

T he bankruptcy court granted Seven Stars leave to amend over MDG’s ob jection
, and , on January 15, Seven Stars filed an uncontested motion requesting a 60

- day extension of “both the Fact and Expert discovery deadlines.” The attached proposed order also

2 For ease of reference, we refer to the deadline to exchange expert witness summaries and reports as the expert disclosure deadline. See Fed. R. Civ. P. 26(a)(2); Fed. R. Bankr. P. 7026. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 4 of 1622

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extended other pretrial deadlines, including expert disclosure, by 60 days.

Seven Stars filed its operative second amended complaint in la te January 2021 , asserting common

- law claims and claims under Florida’s Deceptive and Unfair Trade Practices Act. At the same time, Seven Stars asked the court in the main bankruptcy proceeding to authorize a ter m litigation funding agreement to cover Leg alist’s costs in conduct ing the due diligence necessary to decide whether to offer a full funding agreement. A fter oral argument

,the bankruptcy court allowed Seven Stars to enter the term agreement, noting the court would need to approve any future litigation funding agreement.
On March 15, Seven Stars filed a second motion to extend

“ discovery deadlines, ” requesting a 30

- day “enlarge[ment of] the time for the completion of discovery

. ” C ounsel found “it necessary to request additional time to comple te fact discovery and then to proceed with the completion of expert discovery.” She explained there were troubles scheduling depositions and that Seven Stars’ principals had a family medical emergency. Seven Stars also expected to soon find out whether i t would receive funding from Legalist, which it needed to complete discovery. The motion, whichwas filed before hearing back from opposing counsel, did not include a new proposed schedul ing order or refer to the expert disclosure deadline although it not ed the fact and expert discovery deadlines

. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 5 of 166 Opinion of the Court 22

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Two days later, t he bankruptcy court entered the second agreed scheduling order , which had been attached to the January 15 motion. The new schedule set fact discovery due by March 16, expert disclosure by April 6, and expert discovery by May 14. The

court also scheduled a hearing on the March 15 motion for April 7. On April 6, in the main bankruptcy proceeding, Seven Stars moved for permission to enter into a full f unding agreement with Legalist for $105,000 to cover the cost of litigation. Otherwise, t he April 6 expert disclosure deadline passed without Seven Stars disclosing an expert witness.On April 7, the bankruptcy court held a hearing on the discovery timeli ne. Given the family medical emergency, MDG and
XBK did not oppose extending the fact discovery deadline to take depositions, and the bankruptcy court extended fact discovery until April 29. But MDG opposed extending the expert discovery deadline because Seven Stars had not explained why an extension of that deadline was needed . Although Seven Stars’ counsel believed the other deadlines would be moved along with the fact discovery deadline, the bankruptcy court disagreed and found an extension

on the other deadlines was not properly before it based on the March 15 extension motion

. Consequently, i t left the other deadlines in the scheduling order intact and stated the parties could confer and file another motion if needed

. A coup le of days later , Seven Stars amended its litigation funding motion in the main bankruptcy proceeding, adding that it needed the funds to cover the costs of experts and assistance for USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 6 of 1622

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trial counsel. At a n April 14 hearing on the litigation funding, MDG objected to the proposed $55,000 to cover the cost of expert witnesses because Seven Stars had not timely disclosed an expert or provided an expert report and

, if approved, Seven Stars would need
to pay a multiplier on funds it could not use. The bankruptcy court overruled MDG’s objection and permitted Seven Stars to enter intothe litigation funding agreement, finding it was an appropriate exercise of the debtor ’ s business judgment under the circumstances.
But the court also reiterated that it had only ext ended fact discovery in the adversary proceeding and would entertain an extension motion regarding expert discovery when, or if, it was presented. The written order granting the litigation funding was entered on April 19. On April 28, Seven Stars moved for a third discovery extension in the adversary proceeding , requesting the “ fact discovery deadline ” be extended to May 14 and the “ expert deadline ” be extended from May 15 to July 14, 2021. Seven Stars explained that “[e]x pert discovery in this case was anticipated from the beginning on the issue of damages,” but it had been waiting for the funding agreement to hire experts. It also stated it was “in the process of finalizing a decision on experts and once retained, the ex pert willneed the sixty days to investigate and prepare a report and for expert depositions to take place.” However, like the second extension motion, the April 28 motion did not expressly address the expert disclosure deadline, refer to the April 6 dead line, or attach a new proposed schedule. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 7 of 168 Opinion of the Court 22

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MDG objected in part , emphasizing that Seven Stars was seeking a third extension in less than four months of both fact and expert discovery deadlines. Although MDG did not oppose another extension of fact discove ry, it argued none of the exigent circumstances cited by Seven Stars had bearing on expert discovery deadlines. It also noted that Seven Stars had not “expressly requested an extension of the now

- passed expert disclosure deadline.”
In response to MDG’s objections, Seven Stars added a request “that the deadline for identifying and designating experts be extended to June 3, 2021.”
Around this time, the bankruptcy court confirmed the Subchapter V plan in the main bankruptcy proceeding. On May 12, the ban kruptcy court held a hearing on the third
extension motion where Seven Stars pointed out its funding issues and that the expert discovery period had not expired. Seven Stars also indicated it had “sent the resume” for an expert to Legalist and was waiting on approval, which would take “a little bit longer than expected,” about two weeks. The bankruptcy court acknowledged its familiarity with the funding issues and lengthy litigation history but asked why Seven Stars waited three weeks after the April 6 e xpert disclosure deadline to seek an extension. Seven Stars responded that it “had absolutely no expert to designate at that point.”

While t he bankruptcy court extended the fact discovery deadline until May 14 , it refused to extend the “ expert discovery USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 8 of 1622

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deadline

. ” It explain ed that “[ s ] cheduling orders matter, ” it hadgranted previous extensions, and the defendants objected to another extension. Although t he court “ empathize [d]” with Seven Stars’ position, it found that Seven Stars had long

- known about the need for an expert on damages yet failed to timely disclose an expert, timely move to extend the expert deadline

, or show good cause under Federal Rule of Civil Procedure 16 to extend it

. O n May 23
, 2021, Seven Stars finally served l ate, unauthorized answers to XBK’s March 17

, 2021, expert witness interrogatories, indicating that Seven Stars was seeking $1.2 million in lost profits and $2.5 million for tortious interference. In the following weeks, Seven Stars twice amended its respo nse to MDG, adding $800,000 for breach of contract. With Seven Stars having disclosed no expert evidence on damages, MDG and XBK moved for summary judgment, arguing that Seven Stars was improperly seeking lost revenues, rather than lost profits, and that the record did not contain sufficient evidenceof damages. Seven Stars opposed the motion and attached a declaration from one of its principals asserting Seven Stars suffered $1,567,387, or $1,888,110 in damages for loss of investment value. MDG and XBK moved to strike the declaration as a sham. The bankruptcy court granted MDG and XBK ’s motion to strike the new declaration, finding it was “clearly inconsistent with Seven Stars’ initial disclosures, interrogatory answers, and [one of Seven Stars’ principals’] own deposition testimony.” Although the bankruptcy court acknowledged there was some evidence to USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 9 of 1610 Opinion of the Court 22

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support Seven Stars’ claims, t he court found Seven Stars had not offered sufficient evidence of damages to create a triable issue of fact, so it granted summary judgment for MDG and XBK

. Seven Stars appealed to the district court, which affirmed the bankruptcy c ourt’s rulings, and Seven Stars now appeal s to this
Court.

II. DISCUSSION

W hile this case has a complex procedural history, Seven Stars has conceded there were no damages calculations contained in its initial Rule 26(a) disclosures, interrogatory responses, or deposition testimony. Instead, Seven Stars’ argument on appeal focuses on whether the bankruptcy court should have extended the
expert discovery deadline so it could present expert testimony on damages and whether the bankruptcy court misapplied Bankruptcy Rule 9006 and Civil Rules 16 and 37

. We first address whether the bankruptcy court abused its discretion by refusing to extend the expert discovery deadlines. See Sosa v. Airprint Sys. , 133 F.3d 1417, 1418

- 19 & n.2 (11th Cir. 1998). We then explain why Civil Rule 37 does not apply.

A. Extending Pretrial Deadlines in Scheduling Orders A court must issue a scheduling order limiting the time to, among other things, complete discovery. Fed. R. Civ. P. 16(b); Fed. R. Bankr. P. 7016 (incorporating Fed. R. Civ. P. 16 for adversary proceedings). The scheduling order can also modify the timing for Rule 26(a) disclosures. Fed. R. Civ. P. 16(b)(3)(B). And, under Rule USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 10 of 1622

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26(a), a party must disclose the identit y of any expert witness along with the appropriate witness report or summary at the time thecourt orders. Fed. R. Civ. P. 26(a)(2); Fed. R. Bankr. P. 7026 (making Fed. R. Civ. P. 26 applicable to adversary proceedings).

The Civil Rule 16 scheduling ord er “controls the course of the action unless the court modifies it.” Fed. R. Civ. P. 16(d). And, once set, “[a] schedule may be modified only for good cause and with the judge’s consent.” Fed. R. Civ. P. 16(b)(4). This good cause standard is tied to th e diligence of the party seeking the extension.
See Sosa , 133 F.3d at 1418; Fed. R. Civ. P. 16 advisory committee ’s

note to 1983 amendment. “[F]or pretrial procedures to continue as viable mechanisms of court efficiency, appellate courts must exercise min imal interference with trial court discretion in matters such as the modification of its orders.” Hodges v. United States , 597 F.2d 1014, 1018 (5th Cir. 1979) 3 (reviewing whether the trial court should have modified a pretrial order to develop certain iss ues at trial). “Thus, we ascribe to the trial court a broad discretion to preserve the integrity andpurpose of the pretrial order, ... and in reviewing trial court decisions which prevent the introduction of otherwise competent and relevant evidence we wil l not disturb the trial court’s ruling unlessit is demonstrated that the trial court has so clearly abused its discretion that its action could be deemed arbitrary.” Id. (citation

3 In Bonner v. City of Prichard , 661 F.2d 1206, 1209 (11th Cir. 1 981) (en banc),this Court adopted as binding precedent all decisions of the former Fifth Circuit handed down prior to close of business on September 30, 1981. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 11 of 1612 Opinion of the Court 22

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omitted). Indeed, we “have often held that a district court’s decision to hold litigants to the clear terms of its scheduling orders is not an abuse of discretion.” St. Louis Condo. Ass’n v. Rockhill Ins.
Co. , 5 F.4th 1235, 1243 (11th Cir. 2021) (quoting Josendis v. Wall to Wall Residence Repairs, Inc. , 662 F.3d 1292, 1307 (11 th Cir. 2011).
As an initial matter, the parties and bankruptcy court were not always explicit in distinguishing between the expert disclosure deadline and the other discovery deadlines. Consequently, i t is debatable whether Seven Stars properly moved for an extension of the April 6 disclosure deadline. The bankruptcy court and district court apparently concluded it did not. Indeed, neither the March 15 nor April 28 motion expressly addressed the April 6 disclosure deadline although the April 28 motion hinted at it. It was not until
Seven Stars ’ respon se to MDG’s objections to the April 28 motion that it specific ally requested an extension of the expert disclosure deadline. In any event, the expert deadlines are related, and the bankruptcy court was acutely aware the April 6 deadline had passed without a n expert being disclosed. H ad it been inclined to
grant an extension of the expert discovery deadline, it would have presumably also extended the disclosure deadline . Considering that Rule 16(b)’s good cause standard applied to both, we will assume the bankruptcy court effectively decline d to extend both the
expe rt disclosure and discovery deadlines

. See Sosa
, 133 F.3d at

1418. 4

4 There has been some confusion about the proper standard. At the May 12 hearing, the bankruptcy court properly discussed Rule 16’s good cause USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 12 of 1622

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On the merits , the bankruptcy court was familiar with the extensive history of the bankruptcy proceedings

— both in the main bankruptcy case and the adversary proceeding, which had been pending since 2019. The bankruptcy court considered Seven Stars’ difficulty in obtai ning funding litigation but refused to extend the April 6 deadline over the defendants’ objection, emphasizing that “[s]cheduling orders matter” and, under the federal rules, they may be modified only for good cause and with the court’s consent. When the bankruptcy court asked Seven Stars to justify the delay in filing the April 28 motion, Seven Stars’ counsel only noted thatit did not have an expert to disclose while it was waiting on approval for the litigation funding. As the bankruptcy court

standard, but it alluded to the excusable neglect standard from Bankruptcy Rule 9006(b)(1 ) in its final memorandum opinion

. See Fed. R. Bankr. P. 9006(b)(1) (giving the bankruptcy court discretion t o extend a period after a deadline has passed “where the failure to act was the result of excusable neglect” ). On appeal, Seven Stars also argues the excusable neglect standard applied to the lapsed expert disclosure deadline. But we have rejected that a rgument, explaining the more specific Civil Rule 16 standard , not the more general Civil Rule 6 standard

, is the proper guide for determining whether a party’s delay in seeking to extend a scheduling order deadline may be excused. Sosa
, 133 F.3d at 1418

- 1 9 & n.2

. We see no reason why that would not also be true for a scheduling order in an adversary proceeding. Moreover, even if a showing of excusable neglect were also required

, t he bankruptcy court discussed many of the excusable neglect factors

. S ee Pioneer Inv. Servs. v. Brunswick Assocs. Ltd. P’ship , 507 U.S. 380, 395 (1993) (discussing excusable neglect ). And Seven Stars did not advance its excusable neglect argument in its April 28 motion

. See Access Now, Inc. v. Sw. Airlines Co. , 385 F.3d 1324, 1331 (11th Cir. 2004) (explaining we will not typically consider an issue not raised in the lower court). USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 13 of 1614 Opinion of the Court 22

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explaine d, Seven Stars planned early in the litigation to introduce expert testimony on damages, yet it failed to act diligently to protect its ability to do so.

Seven Stars also points out that the bankruptcy court approved the funding litigation agreement as an appropriate exercise of Seven Stars’ business judgment over MDG’s objections to the expert fees. But at the April 14 hearing on the litigation funding, the bankruptcy cou rt explained it was not considering the expert disclosure deadlines in the adversary proceeding and that Seven
Stars still needed to move for an extension. Nothing a t that hearing suggested the bankruptcy court would grant such a motion

, and the denial of the April 28 motion was not inconsistent with permitting the funding agreement.

Th e bankruptcy court’s refusal to extend the expert discovery deadlines was undoubtedly a consequential decision, and w e might have made a different decision . But we cannot s ay the bankruptcy court’s choice to enforce the April 6 expert disclosure deadline constituted a clear error of judgment. See St. Louis Condo.
Ass’n , 5 F.4th at 1243 ; Hodges , 597 F.2d at 1018 ; see also In re Rasbury

, 24 F.3d 159, 168 (11th Cir. 1994) (di scussing the range of choices afforded to a district court under an abuse of discretion standard of review)

.
B

. Civil Rule 37(c) Sanctions

Seven Stars also discusses Civil Rule 37(c) and contends the bankruptcy court erred in imposing the harshest sanction and in USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 14 of 1622

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not considering certain factors when refusing to extend the April 6 deadline

.
U nder Rule 37, “[i]f a party fails to provide information or identify a witness as required by Rule 26(a) or (e), the party is not allowed to use that information or witness to supply evidence on a motion, at a hearing, or at a trial, unless the failure was subs tantially justified or is harmless.” Fed. R. Civ. P. 37(c); see Fed. R. Bankr. P. 7037 ( applying Fed. R. Civ. P. 37 in adversary proceedings).

However, Rule 37 (c) is not relevant to the extension issue presented, and Seven Stars has abandoned any issue re lated to striking the declaration by its principal. 5 A s the district court explained, the bankruptcy court did not exclude any of Seven Stars’ expert evidence as a sanction under Rule 37(c) because Seven Stars never offered an expert witness or expert testimony. As a result, the bankruptcy court did not need to consider whether the failure to comply with Rule 26(a) was “substantially justified or

. . . harmless.” Fed. R. Civ. P. 37(c). Nor , as Sev en Stars would ask, can we fault the bankruptcy court for not using a five

- factor test deriv ed

5 After the Rule 37(c) section, Seven Stars dedicated a seven

- page section of its initial brief in the district court to arguing the bankruptcy court erred in striking the declaration as a sham. However, Seven Stars omitted that section fr om its initial brief in this Court, and it makes only a passing comment in a footnote that the bankruptcy court abused its discretion in striking the declaration.

“ Normally , we do not review arguments that were raised only in a footnote without supporting argument.” Lavigne v. Herbalife, Ltd. , 967 F.3d 1110, 1120 n.7 (11th Cir. 2020)

. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 15 of 1616 Opinion of the Court 22

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from the Fourth Circui t, particularly where the bankruptcy courtdiscussed issues like Seven Stars’ explanation for the delay, the importance of expert testimony on the issue of damages, and the harm to the defendants

. To the extent the bankruptcy court’s summary judgment memorandum opinion discussed Rule 37 (c) in the context of disclosure , it concluded Seven Stars would have failed to meet its burden under Rule 37 (c) even if it had offered late expert evidence. Considering that Seven Stars did not actually seek to admit late expert evidence, we need not decide whether that conclusion was

correct.

III. CONCLU SION

T he bankruptcy court did not abuse its discretion in refusing to further extend the expert discovery deadline s , and without competent evidence on damages, the grant of summary judgment for the defendants is due to be affirmed. 6

AFFIRMED.

6 We GRANT t he appellant’s motion to correct or amend its reply brief , and

we DENY MDG’s motion for Fed. R. App. P. 38 sanctions

. Although we affirm the bankruptcy court’s decision, this appeal was not frivolous, and sanctions against Seven Star s are not warranted. USCA11 Case: 22-13591 Document: 56-1 Date Filed: 07/26/2023 Page: 16 of 16