NOT PRECEDENTIAL 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

___________ 

No. 23-1251 

___________ 

IN RE: KENNETH J. TAGGART, 

 Appellant 

____________________________________ 

On Appeal from the United States District Court 

for the Eastern District of Pennsylvania 

(D.C. No. 2:22-cv-01823) 

District Judge: Honorable John M. Younge 

____________________________________ 

Submitted Pursuant to Third Circuit L.A.R. 34.1(a) 

on January 17, 2024 

Before: BIBAS, PORTER, and MONTGOMERY-REEVES, Circuit Judges 

(Opinion filed: February 29, 2024) 

____________________________________ 
2

___________

OPINION*

___________

PER CURIAM

Kenneth J. Taggart appeals pro se from the District Court’s affirmance of a Bankruptcy Court order dismissing his bankruptcy petition. For the following reasons, we will 

affirm the District Court’s judgment.

I.

In September 2021, Taggart filed a pro se voluntary petition under Chapter 11 of 

the United States Bankruptcy Code. Taggart’s primary assets were several properties. 

He had previously defaulted on his mortgages for those properties around 2009 and subsequently initiated numerous state and federal lawsuits seeking to prevent foreclosure by 

his creditors.

After initiating his bankruptcy case, Taggart did not file a plan of liquidation or reorganization to indicate how he sought to proceed. In April 2022, the City of Philadelphia moved to dismiss Taggart’s case for cause. The City argued that cause existed for 

the dismissal under 11 U.S.C. § 1112(b)(1) because Taggart’s reported monthly income 

was insufficient to pay his debts and there was no reasonable likelihood of rehabilitation, 

among other reasons. Another party sought a bar against Taggart preventing him from 

refiling a bankruptcy petition for two years, given his extensive litigation history.

* This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not 

constitute binding precedent.
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At a May 2022 hearing, Taggart conceded that rehabilitation of the estate was unlikely because of the litigation he was pursuing and intended to pursue for several more 

years, preventing the development of a plan. Rather than a typical dismissal, Taggart 

sought a “structured dismissal” in which various conditions that he requested would be 

attached to the dismissal. His requests included that a claim of one mortgage-holder be 

dismissed through a sale of his home, free of all liens, to one of the other occupants of the 

home. He also sought to secure various assets after dismissal of the case, including his 

car, sports tickets, and a timeshare. 

 At the conclusion of the hearing, the Bankruptcy Court dismissed Taggart’s petition 

without imposing any conditions or a refiling bar. The Bankruptcy Court concluded that 

Taggart had not attempted to resolve his claims with his creditors and that his operating 

reports did not show sufficient income to pay his debts. Accordingly, it concluded that 

the case lacked a reasonable likelihood of rehabilitation, making dismissal warranted.1

 

Taggart timely appealed to the District Court. 

 In December 2022, the District Court affirmed the Bankruptcy Court’s decision. It 

concluded that dismissal without the conditions requested by Taggart was appropriate, 

given Taggart’s inability to propose a plan that could be effectuated. It also concluded 

that the due process claims Taggart raised on appeal were meritless. Taggart timely appealed. 

II. 

1

 Taggart sought reconsideration, which was denied. However, Taggart did not appeal 

that order and thus it is not part of this appeal. See Fed. R. Bankr. P. 8002(b)(3). 
4 

We have jurisdiction under 28 U.S.C. §§ 158(d)(1) and 1291. We review the dismissal of a Chapter 11 petition for abuse of discretion. In re SGL Carbon Corp., 200 

F.3d 154, 159 (3d Cir. 1999). An abuse of discretion may be based on “a clearly erroneous finding of fact, an errant conclusion of law, or an improper application of law to fact” 

and thus “we review the findings of fact leading to the decision for clear error and exercise plenary review over the court’s conclusions of law.” Id. 

III. 

We agree with the District Court’s affirmance of the Bankruptcy Court’s dismissal 

of Taggart’s case. Taggart first argues that the Bankruptcy Court should not have dismissed his case without implementing the conditions in his proposed structured dismissal. 

When presented with a request by a party in interest, a bankruptcy court must (after notice and hearing) either dismiss a Chapter 11 case or convert it to a case under 

Chapter 7, “whichever is in the best interests of creditors and the estate,” for cause.2

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U.S.C. § 1112(b)(1). The Bankruptcy Code includes examples of cause, including a 

“substantial or continuing loss to or diminution of the estate and the absence of a reasonable likelihood of rehabilitation.” Id. § 1112(b)(4)(A). A debtor’s “[i]nability to effectuate a plan” is also “a viable basis for dismissal.” In re Am. Cap. Equip., LLC, 688 F.3d 

145, 162 n.10 (3d Cir. 2012) (alteration in original) (citation omitted). 

Taggart conceded at the dismissal hearing that he was unable to show a reasonable 

2

 Alternately, the bankruptcy court can appoint a trustee or an examiner if that is in the 

best interests of the creditors and the estate. See 11 U.S.C. § 1112(b)(1). 
5 

likelihood of rehabilitation because of pending litigation regarding his properties, which 

he expected to last for several years. Taggart’s filings and monthly expense reports also 

showed that he did not have sufficient income to pay his significant debts. Thus, the 

Bankruptcy Court’s finding of cause for dismissal was amply supported by the record.3

 

Taggart does not appear to challenge the dismissal decision itself in his appellate brief. 

Rather, Taggart maintains that the Bankruptcy Court should have attached various 

proposed conditions that he requested to its dismissal. After dismissal, barring an order 

providing otherwise upon a finding of cause, a dismissal typically provides for “a restoration of the prepetition financial status quo.” Czyzewski v. Jevic Holding Corp., 580 U.S. 

451, 454-56 (2017); see also 11 U.S.C. § 349. Taggart does not cite any authority suggesting that he was entitled to a structured dismissal under the circumstances presented 

here, where no party had agreed to his proposed conditions. Cf. Jevic, 580 U.S. at 467 

(explaining that the Bankruptcy Code does not authorize “nonconsensual departures from 

ordinary priority rules in the context of a dismissal”). 

Further, Taggart argues in his brief that “no party to the bankruptcy would be prejudiced or receive any less in [his proposal] as opposed to the dismissal” decision made by 

the Bankruptcy Court and that his proposal somehow would have been in the best 

3

 We note that if cause is established, a debtor may still avoid conversion or dismissal by 

showing: (1) “unusual circumstances establishing that converting or dismissing the case 

is not in the best interests of creditors and the estate”; (2) “a reasonable likelihood that a 

plan will be confirmed . . . within a reasonable period of time”; or (3) that “the grounds 

for converting or dismissing the case include an act or omission of the debtor . . . for 

which there exists a reasonable justification” which “will be cured within a reasonable 

period of time.” 11 U.S.C. § 1112(b)(2)(A)-(B). None of these factors were applicable 

here, and Taggart does not appear to argue otherwise in his briefing. 
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interests of all parties. Appellant’s Br. at ECF p. 11. Taggart has not established that this 

is the case, but even if he had, because he asserts that dismissal with his proposed conditions would have left the parties in the same state as a dismissal without those conditions, 

it is not clear how the Bankruptcy Court could have erred by choosing a non-conditional 

dismissal over his proposal. See generally 11 U.S.C. § 1112(b)(1) (directing the Bankruptcy Court to consider “the best interests of creditors and the estate”). Thus, there is no 

basis to conclude that the Bankruptcy Court committed any error in its determination that 

a non-conditional dismissal was most appropriate here. 

Finally, Taggart maintains that his due process rights were violated when the 

Bankruptcy Court dismissed the case without holding a separate hearing regarding his 

structured dismissal request. However, Taggart had notice of the dismissal hearing in advance, filed arguments in support of his structured dismissal proposal before the hearing, 

and made arguments in support of his proposed conditions at the hearing. See 11 U.S.C. 

§ 1112(b)(1) (authorizing dismissal “after notice and a hearing”). The Bankruptcy Court 

noted at the outset of the hearing that it had read the parties’ filings and understood their 

arguments and then permitted them to make additional arguments regarding dismissal. 

Taggart specifically discussed the key conditions he wanted to attach to the dismissal, 

and another party also discussed a requested condition for the dismissal, a refiling bar 

against Taggart. The Bankruptcy Court ultimately decided not to apply any conditions to 

the dismissal after explicitly stating that it had considered the parties’ filings and the arguments made at the hearing. 
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Taggart does not cite any relevant authority to support his assertion that his due 

process rights were violated during the dismissal hearing, and the Bankruptcy Court’s 

dismissal left him free to pursue his arguments in other venues going forward. Cf. Morrissey v. Brewer, 408 U.S. 471, 481 (1972) (“[D]ue process is flexible and calls for such 

procedural protections as the particular situation demands.”). Accordingly, Taggart has 

not established that his due process rights were violated by the Bankruptcy Court. 

For these reasons, we will affirm the judgment of the District Court.