Opinion ID: 3012143
Heading Depth: 2
Heading Rank: 6

Heading: Second Appeal to District Court

Text: The parties again cross-appealed the various orders of Judge Gindin to the District Court of the Virgin Islands. On October 2, 2001, the Honorable Stanley Brotman, U.S. District Court Judge of the District of New Jersey, sitting by designation, issued an opinion affirming in part and _________________________________________________________________ 6. The Bankruptcy Court’s October 2000 Opinion appears to contain a typographical error. At one point in that opinion, the court stated that the Tax Savings amount was $236,522. The Bankruptcy Court later corrected itself, applying the proper $236,566.22 figure. See In re Kool, Mann, No. 390-00017, slip op. at 7 (Bankr. D.V.I. Oct. 10, 2000). 15 reversing in part Judge Gindin’s orders (the October 2001 Opinion). Approving of most of the Bankruptcy Court’s decision, Judge Brotman agreed with the Bankruptcy Court that the bulk of Judge Fullam’s July 1995 Opinion was dicta, and that it merely vacated the Bankruptcy Court’s initial findings on procedural grounds (i.e., inadequate notice) with only two additional substantive holdings: (1) that Kool Mann was not entitled to a set-off for payments made on assumed indebtedness of LCSDI; and (2) that Kool Mann was not entitled to a set-off for Tax Savings. Judge Brotman then found that in any event, the Bankruptcy Court adequately responded on remand to Judge Fullam’s comments. In re Kool, Mann, Nos. 99-00058, 99-00204, 00-00230, slip op. at 14 (D.V.I. Oct. 2, 2001). However, Judge Brotman ruled that the Bankruptcy Court erred with respect to his granting of the Tax Savings issue and denied that credit to Kool Mann. Judge Brotman’s rulings are set forth in the District Court’s judgment issued on October 2, 2001, and can be succinctly summarized as follows:
Estimation Hearing and the adjudication of Kool Mann’s claim is AFFIRMED; 2. Bankruptcy Court’s finding of fraud by the Coffeys, and calculating the actual value of LCSDI as a result of that fraud at $2,288,167 is AFFIRMED; 3. Bankruptcy Court’s grant of credit to Kool Mann for the $1 million downpayment is AFFIRMED; 4. Bankruptcy Court’s release of Moore of his obligations under the personal guaranty is AFFIRMED; 5. Bankruptcy Court’s denial of Coffeys’ request for pre-petition interest is AFFIRMED; 6. Bankruptcy Court’s denial of credit to Kool Mann for assumed indebtedness in the amount of $1.213 million is AFFIRMED; 16 7. Bankruptcy Court’s denial of punitive damages to Kool Mann is AFFIRMED; 8. Bankruptcy Court’s grant of summary judgment in favor of Moore in the adversary proceeding is AFFIRMED on basis of collateral estoppel, not res judicata;7 9. Bankruptcy Court’s grant of credit to Kool Mann in the amount of $236,566.22 in tax savings is REVERSED; 10. Bankruptcy Court’s grant of credit to Kool Mann of $291,784 due to recharacterization of interest payments to principal payments is AFFIRMED. See In re Kool, Mann, Nos. 99-00058, 99-00204, 00-00203, judgment at 2-4 (D.V.I. Oct. 2, 2001). Consequently, Judge Brotman ruled that the total balance due and owing to the Coffeys by Kool Mann was $1,051,600.78.8