1“Pursuant to 28 U.S.C. § 157(a) and the standing order of

January 18, 1994, as it may be amended from time to time, the

court refers cases and proceedings in bankruptcy to the

bankruptcy court of this district.” LR 77.4(a).

UNITED STATES DISTRICT COURT FOR THE 

DISTRICT OF NEW HAMPSHIRE

Olga L. Bogdanov,

Chapter 7 Trustee

v. Civil No. 06-cv-384-JD

B&H Foto & Electronics,

Corp., et al.

O R D E R

Olga L. Bogdanov, Chapter 7 Trustee, filed adversary

complaints against Concentra Integrated Services, Inc.; Nsight

Technologies, LLC; B&H Foto & Electronics, Corporation;

Physicians Specialty Hospital of El Paso East, L.P.; and Christus

Health Corporation in the United States Bankruptcy Court for the

District of New Hampshire. When the defendants failed to respond

within the time allowed, the bankruptcy court entered defaults

against the defendants. The Trustee filed a motion in each case

to withdraw the reference of the adversary proceedings, pursuant

to 28 U.S.C. § 157(d). On September 29, 2006, the bankruptcy

court issued its reports and recommendations on the motions,

agreeing with the Trustee that the reference should be withdrawn

as to all five adversary proceedings.1 

The motions to withdraw the reference in each adversary

proceeding were then filed as separate cases in this court, along

with the bankruptcy court’s recommendations that the references

Case 1:06-cv-00386-SM Document 6 Filed 11/14/06 Page 1 of 5
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be withdrawn. After the Trustee consented to consolidation and

the other parties failed to respond within the time allowed, the

cases were consolidated to address the motions to withdraw the

reference.

Background

Amherst Technologies, LLC, and the related Debtors, filed 

voluntary Chapter 11 petitions on July 20, 2005. The court

granted the Debtors’ motion for joint administration the next

day. The cases were converted to Chapter 7 proceedings, and Olga

L. Bogdanov was appointed Trustee on October 21, 2005.

The Trustee filed adversary complaints against the

defendants, seeking payment of accounts receivable for amounts

that accrued in 2005 both before and after the bankruptcy

petition was filed. The complaints each allege a single claim,

pursuant to 11 U.S.C. § 542, that the amounts due from each

defendant are property of the bankruptcy estate which must be

turned over to the Trustee. In support of the motions to

withdraw the reference, the Trustee asserts that the complaints

involve both core and non-core proceedings, under 28 U.S.C. §

157(c), so that judicial economy would favor withdrawal of the

reference under § 157(d). 

The joint administration of the bankruptcy actions and the

adversary proceedings are all assigned to Bankruptcy Judge J.

Michael Deasy. Judge Deasy recommends that the Trustee’s motions

be granted as to all five adversary proceedings because each

proceeding includes core and non-core matters.

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Discussion

Bankruptcy courts have jurisdiction to “hear and determine

all cases under title 11 and all core proceedings arising under

title 11, or arising in a case under title 11, referred under

subsection (a) of this section, and may enter appropriate orders

and judgments, subject to review under section 158 of this

title.” 28 U.S.C. § 157(b)(1). With respect to a non-core

proceeding that is related to a core proceeding, the bankruptcy

judge may hear the matter but must

submit proposed findings of fact and conclusions of law

to the district court, and any final order or judgment

shall be entered by the district court after

considering the bankruptcy judge’s proposed findings

and conclusions and after reviewing de novo those

matters to which any party has timely and specifically

objected.

28 U.S.C. § 157(c)(1). 28 U.S.C. § 157(d) provides that “[t]he

district court may withdraw, in whole or in part, any case or

proceeding referred under this section, on its own motion or on

timely motion of any party, for cause shown.” Courts have

interpreted “for cause shown” to include such relevant factors as

promoting uniformity in bankruptcy administration, reducing forum

shopping and confusion, preserving the debtors’ and creditors’

resources, and judicial economy. See, e.g., In re Canter, 299

F.3d 1150, 1154 (9th Cir. 2002); In re Pruitt, 910 F.2d 1160,

1168 (3d Cir. 1990); Childs v. Gallagher, 342 B.R. 823, 827 (M.D.

Ala. 2006).

In support of the recommendation that the motions be

granted, Judge Deasey explains that the amounts claimed from the

defendants are based on accounts receivable that became due both

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before the bankruptcy petition was filed and after filing. 

Proceedings that seek an order to turn over property of the

estate pursuant to 11 U.S.C. § 452(b), such as post-petition

accounts receivable, are core proceedings. 28 U.S.C. §

157(b)(2)(E); Beard v. Braunstein, 914 F.2d 434, 445 (3d Cir.

1990). A majority of courts have held, however, that claims

seeking pre-petition accounts receivable are actionable as breach

of contract claims under state law and are not core proceedings. 

See, e.g., In re Apex Exp. Corp., 190 F.3d 624, 631-32 (4th Cir.

1999) (citing cases); In re Nat’l Audit Defense Network, 332 B.R.

896, 911 (Bankr. D. Nev. 2005). 

The bankruptcy court is authorized to enter final judgment

as to the Trustee’s claim under § 452(b) for the post-petition

accounts receivable. With respect to the pre-petition amounts,

which are non-core matters, the bankruptcy court is authorized

only to issue proposed findings and conclusions, which would be

submitted to the district court for de novo review and entry of

judgment. § 157(c)(1). Because the bankruptcy court cannot

enter judgment as to the non-core parts of the Trustee’s claims,

absent consent of the parties, those matters would entail the

same review by both courts. See § 157(c)(2); Growe v. Bilodard

Inc., 325 B.R. 490, 492-93 (D. Me. 2005). 

The bankruptcy court’s docket shows 659 docket entries

during the year and three months the case has been pending there. 

The case has generated other adversary proceedings, many of which

have been resolved. Judge Deasey is familiar with the case and

with the dispositions in the other adversary proceedings. It

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would be in the interest of uniformity in the administration of

the case and in the interest of preserving resources to have

Judge Deasey preside over the five adversary proceedings at issue

here, despite the combination of core and non-core proceedings. 

In these circumstances, the better course is to allow the

bankruptcy court to provide a single forum for all of the issues

and claims that have arisen in the case.

Conclusion

For the foregoing reasons, the Trustee’s motions to withdraw

the reference (document no. 2 in each case) are denied. The

clerk of court shall close this case and the other four cases

that are consolidated into this case.

SO ORDERED.

____________________________

Joseph A. DiClerico, Jr.

United States District Judge

November 14, 2006

cc: Geraldine L. Karonis, Esquire

Olga L. Bogdanov, pro se

Concentra Integrated Services, Inc.

Nsight Technologies, LLC

B&H Foto & Electronics Corp.

Physicians Specialty Hospital of El Paso East, L.P.

Christus Health Corp.

U.S. Bankruptcy Court - NH, Clerk

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