Court Opinion

ID: 4410331
Source: CourtListenerOpinion
Date Created: 2019-06-26 17:00:19.061759+00
Date Added: 2024-06-11T08:46:23.768852
License: Public Domain

NOT PRECEDENTIAL

                       UNITED STATES COURT OF APPEALS
                            FOR THE THIRD CIRCUIT
                                 ___________

                                       No. 18-2010
                                       __________

                      In re: 40 LAKEVIEW DRIVE, LLC, Debtor

                                 GRACE S. WONG,
                                     Appellant
                       ____________________________________

                     On Appeal from the United States District Court
                              for the District of New Jersey
                        (D.N.J. Civil Action No. 2-17-cv-05643)
                       District Judge: Honorable Jose L. Linares
                      ____________________________________

                    Submitted Pursuant to Third Circuit LAR 34.1(a)
                                    June 24, 2019
            Before: CHAGARES, BIBAS and GREENBERG, Circuit Judges

                              (Opinion filed: June 26, 2019)
                                      ___________

                                       OPINION*
                                      ___________

PER CURIAM

*
 This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not
constitute binding precedent.
       Grace Wong, proceeding pro se, appeals an order of the United States District

Court for the District of New Jersey affirming orders of the United States Bankruptcy

Court. For the reasons that follow, we will affirm.

       In 2015, 40 Lakeview Drive, LLC filed a Chapter 11 bankruptcy petition. The

case was converted to Chapter 7. The Trustee moved to compel Grace Wong, the

managing member of 40 Lakeview Drive, LLC, to turn over keys and any alarm codes

that may be needed to obtain access to property located at 16 Avenue A, Mahwah, New

Jersey. The Trustee filed the motion pursuant to 11 U.S.C. § 542(a), which requires an

entity, other than a custodian, in possession, custody, or control of property that the

Trustee may sell to deliver that property to the Trustee. The Bankruptcy Court had

previously authorized the Trustee to retain a realtor to assist in the sale of the property.

The Bankruptcy Court held a hearing and granted the Trustee’s motion on June 29, 2017.

The Court ordered Wong to deliver to the Trustee within three days “all keys, alarm

codes and anything else reasonably necessary to gain access” to the property.

       Wong did not comply and the Trustee moved to hold her in contempt of court.

After a hearing, the Bankruptcy Court issued an order dated July 25, 2017 holding Wong

in civil contempt and fining her $100.00 per day for each day thereafter that she, or any

party in her control (including counsel for 40 Lakeview Drive, LLC) with possession of

the keys, codes, and/or anything else reasonably necessary to gain access to the property,

fails to turn over the items to the Trustee. The Bankruptcy Court also ordered Wong to

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pay the Trustee’s counsel fees in the amount of $2,500.00. The Court authorized the

Trustee to change the locks and any codes at the property and to seek the assistance of the

United States Marshall if Wong did not comply within five days.

       Wong did not turn over the keys and the Trustee moved for an order detailing the

scope of assistance that could be provided by the United States Marshall if assistance was

required. After a hearing, the Bankruptcy Court issued an order on August 9, 2017

stating, among other things, that if a locksmith could not provide access to the property,

the United States Marshall may assist with the use of force. On August 17, 2017, the

Bankruptcy Court issued a supplemental opinion addressing the order.

       Wong appealed the July 25, 2017 contempt order and the August 9, 2017 order

detailing the scope of assistance that could be provided by the United States Marshall.

The District Court affirmed both orders. The District Court deemed the appeal of the

August 9, 2017 order abandoned because Wong did not advance any arguments regarding

the order in her brief. The District Court also found that the Bankruptcy Court did not

abuse its discretion in holding Wong in civil contempt of court because there was a valid

court order directing her to turn over the keys and codes, Wong had knowledge of the

order, and she did not comply with it. This appeal followed.

       We have jurisdiction over an appeal of a District Court order affirming a

Bankruptcy Court order holding a non-party in civil contempt. See In re Teknek, LLC,

512 F.3d 342, 344–45 (7th Cir. 2007). Because the District Court sat as an appellate

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court, we review the Bankruptcy Court’s legal determinations de novo, its factual

findings for clear error, and its exercises of discretion for abuse thereof. In re Goody’s

Family Clothing Inc., et al., 610 F.3d 812, 816 (3d Cir. 2010). The imposition of civil

contempt is reviewed for abuse of discretion. Harris v. City of Philadelphia, 47 F.3d

1311, 1321 (3d Cir. 1995).1

       Wong presents two arguments for our review. First, she contends that the

Bankruptcy Court could not order her to hand over the keys and alarm codes because she

has no control over the tenants and counsel for 40 Lakeview Drive, LLC, who possessed

these items. As recognized by the District Court, to the extent Wong challenges the June

29, 2017 order requiring her to deliver the keys and codes, that order is not before us.

See Marshak v. Treadwell, 595 F.3d 478, 486 (3d Cir. 2009) (a party who is alleged to be

in contempt of an order may not challenge the merits of that order within the contempt

proceedings).2

       Wong also asserts that the Bankruptcy Court erred in holding her in contempt

because she has no control over the tenants and counsel for 40 Lakeview Drive, LLC,

who possessed the keys and codes. A person is liable for civil contempt where a valid

1
 The Trustee argues that we should dismiss this appeal as moot. We conclude that he has
not shown that we are unable to provide effective relief or that the doctrine of equitable
mootness applies here. See In re Tribune Media Co., 799 F.3d 272, 277 (3d Cir. 2015).
2
 The District Court dismissed Wong’s appeal of the June 29, 2017 order after she failed
to timely file a brief. See D.N.J. Civ. No. 17-cv-05730.
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court order existed, the person had knowledge of the order, and the person disobeyed it.

See Marshak, 595 F.3d at 485. To the extent Wong disputes that she disobeyed the order

because she was unable to comply with it, she has not shown that she could not comply.

Wong has not shown that the Bankruptcy Court erred in ruling at the hearing on the

contempt motion that as the managing member of 40 Lakeview Drive, LLC, she was able

to direct its counsel and/or the tenants of the property to turn over the keys. See generally

N.J. Stat. Ann. § 42:2C-37 (addressing management of limited liability companies).

       Accordingly, we will affirm the order of the District Court.3

3
 Wong’s motion for leave to file a supplemental appendix is granted.
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