UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

WEST PALM BEACH DIVISION

www.flsb.uscourts.gov

In re:

PALM BEACH BRAIN & SPINE, LLC.,

MIDTOWN OUTPATIENT SURGERY

CENTER, LLC, and MIDTOWN 

ANESTHESIA GROUP, LLC, 

 

 Debtors.

CHAPTER 11

CASE No. 19-20831-MAM

(Jointly Administered)

DEBTOR’S MOTION TO APPROVE SETTLEMENT 

AGREEMENT PURSUANT TO BANKRUPTCY RULE 9019

Expedited Hearing Requested: It is respectfully requested that this 

matter be heard on an expedited basis. The counterparty to proposed 

settlement has indicated that time is of the essence to get this 

settlement approved. Accordingly, the Debtors request that this 

motion be heard on the earliest available hearing date on which other 

matters in this case are set for hearing, which appears to be 

December 19, 2019 at 1:30 p.m. Eastern, or as soon thereafter as 

the Court will permit. 

DEBTOR’S MOTION TO APPROVE SETTLEMENT 

AGREEMENT PURSUANT TO BANKRUPTCY RULE 9019

COMES NOW Debtors, PALM BEACH BRAIN & SPINE, LLC; MIDTOWN 

OUTPATIENT SURGERY CENTER, LLC; and MIDTOWN ANESTHESIA GROUP, LLC, (the 

“Debtors”), and file this Motion to Approve Settlement Agreement Pursuant to Bankruptcy Rule 

9019, showing the Court as follows:

BACKGROUND

1. On August 14, 2019, the Debtors filed voluntary petitions for relief under Chapter 11 

of the Bankruptcy Code. Since the filing, the Debtors have continued in possession of their property 

and has operated and managed their affairs as a debtor-in-possession pursuant to the provisions of 

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Sections 1107 and 1108 of the Bankruptcy Code. No trustee, examiner, or committee has been 

appointed in this case.

2. This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1334 and 157. 

This is a core proceeding pursuant to 28 U.S.C. § 157(b). Venue is proper pursuant to 28 U.S.C. 

§§ 1408 and 1409.

3. Between October 2014 and August 2015, the Debtors entered into seven 

substantially similar Letter of Protection and Medical Lien Sale and Agreements (the 

“Agreements”) with CareCentric Investments I, LLC f/k/a CareCentric-Gallop PI Capital 

Partners, LLC, (“CareCentric”). Pursuant to the Agreements, the Debtors sold specific batches 

of patient accounts receivable to CareCentric (the “Purchased Receivables”). The Debtors 

entered into similar agreements with other account purchasers as well.

4. Given the age of the CareCentric Purchased Receivables, it appeared unlikely that 

any of these receivables would still be collectible after the Petition Date. Accordingly, CareCentric 

chose not to continue taking actions to collect on the Purchased Receivables.1

5. Recently, an attorney representing a certain patient with the initials D.K. contacted the 

Debtors and CareCentric seeking to make an offer to settle the patient’s account. The balance shown 

on the patient’s account (and hence, the amount of the Purchased Receivable related thereto) is 

$269,751.97 (the “Account”). The patient’s attorney appears to very motivated to settle the 

1

 Initially, CareCentric filed a motion for relief from stay [Doc. 100], seeking a “comfort order” stating that the 

Purchased Receivables are not property of the Debtors’ estates and authorizing CareCentric to take certain collection 

actions. After filing that motion, it appeared that at least one other creditor would require CareCentric to enter into an 

intercreditor agreement in order to avoid a contested hearing on its stay relief motion. Given CareCentric’s view that 

these accounts from four or five years ago would most likely be uncollectible, CareCentric concluded that “the juice 

wasn’t worth the squeeze” and withdrew its stay relief motion without prejudice to re-filing. Given the patient’s 

attorney’s motivation to get this settlement approved quickly, it appeared that the fastest way to resolve this matter 

would be by filing this Motion.

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Account as soon as possible and has been zealously contacting representatives of the Debtors and 

CareCentric in order to try to finalize a settlement.

THE PROPOSED SETTLEMENT

6. The patient’s attorney has offered to pay $88,500.00 in cash (the “Settlement 

Amount”), subject to the patient’s approval and other conditions, as a full accord and satisfaction 

of all amounts owed on the Account (the “Account Proceeds”). 

7. The Debtors believe that the Settlement Amount is fair, considering the age of the 

Account and the reality that medical accounts are often settled for a fraction of the stated amount of 

the account. CareCentric also believes the Settlement Amount is fair and has consented to the filing 

of this motion.

8. CareCentric asserts that the Account Proceeds are not property of the Debtors’ 

estates but recognizes the possibility that other of the Debtors’ creditors may assert rights to some 

of the Account Proceeds.

9. Accordingly, the Debtors propose to settle the Account in exchange for the 

Settlement Amount, which the Debtors will hold in a segregated trust account, subject to any rights 

CareCentric or any other creditor may assert as to the Account Proceeds, all such rights being fully 

reserved.

BASIS FOR RELIEF

10. Bankruptcy Rule 9019(a) provides that “[o]n motion by the trustee and after notice 

and a hearing, the court may approve a compromise or settlement.” FED. R. BANKR. P. 9019(a).

11. The decision of whether or not to approve a compromise under Bankruptcy Rule 

9019(a) is within the sound discretion of the court. In re Foster Mortg. Corp., 68 F.3d 914, 917 (5th 

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Cir. 1995); In re American Reserve Corp., 841 F.2d 159, 162 (7th Cir. 1987); In re Walsh Construction, 

Inc., 669 F. 2d 1325, 1328 (9th Cir. 1992).

12. When applying this rule, a bankruptcy court should approve a settlement if it is fair

and equitable, and in the best interests of the estate. In re Cajun Electric Power Cooperative, Inc., 

119 F.3d 349, 355 (5th Cir. 1997). To properly make this determination, a bankruptcy judge “must 

assess and balance the value of the claim that is being compromised against the value to the estate of 

the acceptance of the compromise proposal.” Id. at 356; In re Martin, 91 F.3d 389, 393 (3d Cir. 1996); 

In re Jeffrey, 70 F.3d 183 (1st Cir. 1995); see also In re World Health Alt., Inc., 344 B.R. 291, 296 

(Bankr. D. Del. 2006) (“[T]he court does not have to be convinced that the settlement is the best 

possible compromise. Rather, the court must conclude that the settlement is within the reasonable 

range of litigation possibilities.”). 

13. In examining a settlement, the Court should “canvass the issues and see whether the 

settlement falls below the lowest point in the range of reasonableness.” In re Spielfogel, 211 B.R. 133, 

143–44 (Bankr. S.D.N.Y. 1997); In re Telesphere Communications, Inc., 179 B.R. 544, 553 (Bankr. 

N.D. Ill. 1994); In re Carla Leathers, Inc., 44 B.R. 457, 465 (Bankr. S.D.N.Y. 1984), aff’d, 50 B.R. 

764 (S.D.N.Y. 1985); In re W.T. Grant & Co., 699 F.2d 599, 608 (2d Cir. 1983), cert. denied, 464 U.S. 

822 (1983).

14. The Debtors submit that the Settlement is fair and equitable, and it is in the best 

interests of the Debtors, their estate, their creditors, and all other parties in interest, and accordingly 

should be approved pursuant to Rule 9019 of the Federal Rules of Bankruptcy Procedure.

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CONCLUSION

WHEREFORE, pursuant to Bankruptcy Rule 9019, the Debtors respectfully request that the 

Court enter an order (i) granting this Motion, (ii) approving the settlement on the terms described 

herein, and (iii) granting such other relief that is just and proper.

Dated: December 12, 2019 KELLEY, FULTON & KAPLAN, P.L.

Attorney for Debtors 

1665 Palm Beach Lakes Blvd.

The Forum - Suite 1000

West Palm Beach, Florida 33401 

Tel: (561) 491-1200

Fax:(561) 684-3773

By:__/s/ Dana Kaplan__________ 

Dana Kaplan, Esquire 

Fla. Bar No. 44315

Mailing Information for Case 19-20831-MAM 

Electronic Mail Notice List 

The following is the list of parties who are currently on the list to receive email

notice/service for this case. 

• Joaquin J Alemany joaquin.alemany@hklaw.com, jose.casal@hklaw.com 

• Eyal Berger eyal.berger@akerman.com, jeanette.martinez@akerman.com 

• Jonathan M Davidoff jonathan@davidofflawfirm.com 

• Robert W Davis robert.davis@hklaw.com, pauline.nye@hklaw.com 

• Drew M Dillworth ddillworth@stearnsweaver.com,

mfernandez@stearnsweaver.com;rross@stearnsweaver.com;dillworthcdp@ecf.e

piqsystems.com;cgraver@stearnsweaver.com;fsanchez@stearnsweaver.com 

• Heidi A Feinman Heidi.A.Feinman@usdoj.gov 

• Malinda L Hayes malinda@forbusinessandlife.com, mlhbnk@gmail.com 

• Kelly D Haywood khaywood@bhpalaw.com 

• John B. Hutton III huttonj@gtlaw.com,

mialitdock@gtlaw.com;miaecfbky@gtlaw.com 

• Dana L Kaplan dana@kelleylawoffice.com,

tina@kelleylawoffice.com;craig@kelleylawoffice.com;cassandra@kelleylawoffice.

com;debbie@kelleylawoffice.com 

• Benjamin Keck bkeck@rlklawfirm.com 

• Craig I Kelley craig@kelleylawoffice.com,

dana@kelleylawoffice.com,tina@kelleylawoffice.com,cassandra@kelleylawoffice

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.com;debbie@kelleylawoffice.com 

• Lawrence A Levine llevine@anl-law.com, pleadings@anl-law.com 

• Ronald Lewis ron@lewisthomaslaw.com, bennie@cbrlawgroup.com 

• David B Marks brett.marks@akerman.com, charlene.cerda@akerman.com 

• Orfelia M Mayor omayor@ombankruptcy.com, legalservices@pbctax.com 

Manual Notice List 

The following is the list of parties who are not on the list to receive email notice/service

for this case (who therefore require manual noticing/service). You may wish to use your

mouse to select and copy this list into your word processing program in order to create

notices or labels for these recipients. 

Edwin Lunsford

2000 PGA Blvd #3200A 

Palm Beach Gardens, FL 33408

Rountree

2987 Clairmiont Rd #175 

Atlanta, GA 30329

Wells Fargo Vendor Financial Svcs LLC

c/o Christine R Etheridge 

POB 13708

Macon, GA 31208 

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