UNITED STATES BANKRUPTCY COURT 

FOR THE SOUTHERN DISTRICT OF FLORIDA 

ORLANDO DIVISION 

Case No. 19-18585-MAM 

CHAPTER 11 

IN RE: 

MERIDIAN MARINA & YACHT CLUB OF 

PALM CITY, LLC 

Debtor. 

/

RESPONSE IN OPPOSITION TO OBJECTION TO CLAIM AND 

MOTION TO STRIKE OBJECTION AND INCORPORATED 

MEMORANDUM OF LAW 

Creditor NRC GULF ENVIRONMENTAL SERVICES, INC. f/k/a PROGRESSIVE 

ENVIRONMENTAL SERVICES, INC. d/b/a SWS ENVIRONMENTAL SERVICES (“SWS”) 

by and through undersigned counsel, hereby moves the Court to strike the Objection of Debtor 

MERIDIAN MARINA & YACHT CLUB OF PALM CITY, LLC (“Meridian”) and states further 

in support as follows: 

1) On September 16, 2019, SWS (as Progressive Environmental Services, Inc.) timely 

filed its Proof of Claim in this matter, stating that Meridian is indebted to SWS in the amount of 

$58,433.21 (POC No. 11). 

2) On May 29, 2020, Meridian filed its Third Amended Disclosure [Doc 115] and 

stated in “Exhibit A” thereto that the correct amount of Claim 11 by Progressive Environmental 

Services, Inc. was $46,179.83, and that the claim shall be reduced to that amount. [Doc 115-1]. 

3) Therefore, Meridian admitted that the undisputed amount of SWS’s claim is 

$46,179.83 (the “Undisputed Amount”). 

4) Furthermore, Meridian scheduled SWS’ claim in the Undisputed Amount and did 

not list the claim as contingent, unliquidated, or disputed. 

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5) SWS did not contest this reduction of its claim because upon review of Meridian’s 

Plan in this bankruptcy, and conversation with the U.S. Trustee’s office, SWS understood that 

there would most likely be sufficient funding available following the sale of the marina property 

at issue in this matter to fully pay the Undisputed Amount. 

6) On October 29, 2020, Meridian again acknowledged the Undisputed Amount of 

SWS’ claim as $46,179.83. [See Doc. 290; see also Doc. 292 (Meridian acknowledging that 

Progressive Environmental Services filed a proof of claim and that SWS and Progressive are the 

same entity such that payment should be made to Progressive in the Undisputed Amount), Doc. 

346 (Court sustaining this objection)]. 

7) On November 17, 2020, attorney Robert Lewis, on behalf of Meridian, contacted 

SWS’ counsel with an offer to resolve SWS’ claim for the amount of $32,000.00, with the promise 

that his clients, Meridian and Timothy Mullen, would “ensure an ‘Undisputed Proof of Claim’ on 

behalf of SWS...to which, shall be paid in full on or before December 31, 2020.” Mr. Lewis 

requested a response in writing by Friday, November 20, 2020. A true and correct copy of this 

email correspondence is attached hereto as Exhibit 1. 

8) In light of its understanding that it would receive payment of the Undisputed 

Amount in full, SWS chose not to agree to this further reduction. 

9) At no time, either verbally or in writing, did SWS or its counsel agree to this further 

reduction of its claim. 

10) However, before the deadline for response had even passed, on November 19, 2020, 

Meridian, through counsel Dana Kaplan, filed an objection to SWS’ claim (Claim 11) which stated 

“Objection – The correct amount of this claim is $32,000.00 per agreement of the parties. Claim 

shall be reduced to $32,000.00” (the “Objection”). [See Doc. 313]. 

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11) On or about November 24, 2020, SWS’ counsel received a phone call from Mr. 

Lewis who stated that he was following up on the offer he had made to further reduce the amount 

of SWS’ claim. At that time, SWS’ counsel advised that SWS did not intend to agree to this further 

reduction. 

12) On November 25, 2020, SWS received a copy of the Objection and SWS’ counsel 

immediately contacted Ms. Kaplan to advise that the parties had not reached an agreement, that 

the Objection contained a misrepresentation, and to request that Ms. Kaplan immediately withdraw 

the Objection. A true and correct copy of the email correspondence exchanged between 

undersigned counsel and Ms. Kaplan is attached hereto as Exhibit 2. 

13) Ms. Kaplan responded to this email on November 25, 2020, and stated that she 

would need to consult Mr. Lewis and her client, but that “[s]ince this amended objection was filed 

on November 19, we have some time.” See id. 

14) On December 1, 2020, undersigned counsel followed up with Ms. Kaplan to 

determine whether she had confirmed with Mr. Lewis and her client that no agreement had been 

reached. See id.

15) On December 3, 2020, Ms. Kaplan responded, and advised that she had now been 

authorized to offer $38,000.00 as full resolution of SWS’ claim. Ms. Kaplan further stated that if 

SWS would not agree to this reduction of its claim, that “the full amount of the claim will be held 

in escrow until a trial on the claim is held by the court and the court rules on same.” See id.

16) On December 4, 2020, undersigned counsel responded to Ms. Kaplan to advise that 

she would present the revised offer to SWS, but requested that “in the meantime, as it appears that 

you have confirmed that the representation that the parties have reached an agreement is not 

correct, please withdraw the objection as it contains a confirmed misrepresentation.” See id.

17) Ms. Kaplan did not respond to this request or withdraw the Objection. 

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18) On December 15, 2020, having received no response to the request to withdraw the 

Objection, undersigned counsel sent a letter to Ms. Kaplan, advising that the Objection to the 

Undisputed Amount is improper under applicable law and a potential violation of Fed. R. Bankr. 

P. 9011(b), and requested once again that Meridian withdraw the objection. A true and correct 

copy of this correspondence is attached hereto as Exhibit 3. 

19) On December 18, 2020, undersigned counsel placed a phone call to Ms. Kaplan’s 

office to attempt to speak to her concerning the Objection. However, no one answered the phone 

and Ms. Kaplan’s answering message advises that her voicemails are not checked, and to transfer 

to the operator who will connect the caller with Ms. Kaplan. Upon transfer, there was still no 

answer. 

20) As of the date of filing, SWS has received no response to its requests that the 

Objection be withdrawn. 

21) SWS has incurred additional unnecessary fees and costs as a result of Meridian’s 

misrepresentation to the Court in its Objection and is now responsible for paying a reasonable 

attorneys’ fee for the work its counsel has performed to bring this misrepresentation to the attention 

of the Court and oppose the Objection. 

MEMORANDUM OF LAW 

Under Rule 12(f) of the Federal Rules of Civil Procedure, made applicable to adversary 

proceedings by Bankruptcy Rule 7012(b), the Court “may strike from a pleading an insufficient 

defense or any redundant, immaterial, impertinent, or scandalous matter.” Here, the Objection 

contains a statement—i.e. that the parties had reached an agreement for the reduction of SWS’ 

claim from the Undisputed Amount—which Meridian’s counsel has acknowledged to be false by 

presenting an offer to resolve SWS’ claim at an amount different than the amount to which the 

Objection represented that the parties had already agreed. Not only was this false statement filed 

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with the Court, but when SWS advised Meridian’s counsel that it would not accept the reduction 

of the Undisputed Amount of its claim, Meridian’s counsel responded by threatening to further 

object to SWS’ claim in order to tie up the full amount of the claim unless SWS would agree to a 

slightly lower reduction. Meridian’s counsel presented no basis for this demand that SWS agree to 

a reduction of the Undisputed Amount, merely an implied threat that if SWS would not agree to 

the reduction, Meridian would cause SWS to spend additional time and expense by objecting to 

the claim which it had already scheduled as undisputed, for no other reason than to strong arm 

SWS into accepting further reduction of its undisputed claim. Such conduct is improper.

The Bankruptcy Court for the Southern District of Florida in In re MacFarland, 462 B.R. 

857, 882 (Bankr. S.D. Fla. 2011) noted that “[i]f a claim is scheduled by a debtor as undisputed 

and in an amount equal to or greater than the amount in the proof of claim, little, if any, 

documentation is necessary. As such, objecting to a claim for such a debt will almost always be a 

Rule 9011(b) violation.” Furthermore, “[e]ven in the event that the scheduled amount is less than 

the proof of claim amount, an objection seeking to strike and disallow the claim in its entirety 

should be overruled without prejudice to the debtor’s right to file a renewed objection to that 

portion of the claim which is in excess of the scheduled amount.” Id. Meridian has already objected 

to the portion of SWS’ claim in excess of the scheduled Undisputed Amount. SWS did not oppose 

this objection. Now, Meridian threatens to object to SWS’ claim in its entirety forcing SWS to 

incur the costs of defending its undisputed claim at trial, unless SWS agrees to a further reduction 

of its claim. “Repeated attempts to strike and disallow claims in their entirety when portions of 

those debts are undisputedly due and owing is tantamount to bad faith justifying the imposition of 

sanctions.” Id.; see also In re Rehman, 479 B.R. 238 (Bankr. C.D. Mass. 2012) (holding that 

judicial estoppel applies to prevent a debtor from objecting to a claim which it had previously 

scheduled as undisputed where it has no good faith basis to deny the claim). 

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While the safe harbor provision of Rule 9011 prevents SWS from bringing a motion for 

sanctions until it has provided a copy of such motion to opposing counsel and given them 21 days 

to respond, SWS is required to respond to Meridian’s Objection by today or its response will be 

considered untimely. Moreover, SWS was led to believe that Meridian would withdraw the 

objection such that incurring the cost of preparing the motion for sanctions was unnecessary. See

Ex. 2, Ms. Kaplan’s statement that “we have some time” when advised that the Objection 

contained a misrepresentation and should be withdrawn. While SWS intends to prepare a motion 

for sanctions and deliver to Meridian’s counsel, it has now been forced to incur the costs of 

preparing this motion to meet the deadline to respond to Meridian’s Objection simply because 

Meridian’s counsel filed a false statement with the Court and refused to correct same. However, 

the Court does have the inherent authority and discretion to impose sanctions sua sponte for bad 

faith conduct of the attorneys appearing before it. See e.g., In re American West Development, Inc., 

588 B.R. 546 (Bankr. D. Nev. 2018) (holding that bankruptcy court has inherent authority to 

regulate the practice of attorneys appearing before it, and sanction imposed pursuant to that 

authority must be preceded by a specific finding of bad faith); see also Fed. R. Bankr. P. 9011(b)(3) 

and (c)(1)(B); 28 U.S.C.A. §1927; 11 U.S.C. §105. 

WHEREFORE, SWS respectfully requests that this Court strike the Objection of Meridian 

to SWS’ claim because it falsely represents that the parties reached an agreement as to the amount 

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PD.30521853.1 

of claim which the parties did not reach, and grant any other and further relief as this Court deems 

just and proper, including an award of attorneys’ fees and costs incurred in making this motion. 

/s/ Mallory H,. Thomas 

Mallory H. Thomas Fla Bar #112212 

Caroline Catchpole Spradlin Fla. Bar #1003631 

PHELPS DUNBAR LLP 

100 South Ashley Drive, Suite 2000 

Tampa, Florida 33602 

Telephone: 813 472 7550 

Facsimile: 813 472 7570 

Email: caroline.spradlin@phelps.com 

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