Court Opinion

ID: 5130260
Source: CourtListenerOpinion
Date Created: 2021-11-30 21:01:12.87481+00
Date Added: 2024-06-11T08:23:16.559173
License: Public Domain

USCA11 Case: 20-12361   Date Filed: 11/30/2021    Page: 1 of 4

                                       [DO NOT PUBLISH]
                         In the
         United States Court of Appeals
               For the Eleventh Circuit

                ____________________

                 Nos. 20-12361; 20-12368
                 Non-Argument Calendar
                ____________________

IN RE: KK-PB FINANCIAL, LLC,
                                                       Debtor,

KK-PB FINANCIAL, LLC,
                                            Plaintiff-Appellant,
versus
160 ROYAL PALM, LLC,

                                           Defendant-Appellee.
USCA11 Case: 20-12361        Date Filed: 11/30/2021     Page: 2 of 4

2                      Opinion of the Court                20-12361

                     ____________________

          Appeals from the United States District Court
              for the Southern District of Florida
     D.C. Docket No. 9:19-cv-80342-RLR; 9:20-cv-80216-RLR
                    ____________________

Before JORDAN, ROSENBAUM, and NEWSOM, Circuit Judges.
PER CURIAM:
        KK-PB Financial (“KK-PB”) appeals from an order of the dis-
trict court dismissing two of its bankruptcy appeals as equitably and
constitutionally moot. Largely for the reasons stated in the district
court’s order, see D.E. 67 in Case No. 19-cv-80342-RLR, we affirm.
       The two bankruptcy appeals filed by KK-PB are from (1) the
bankruptcy court’s confirmation of the debtor’s bankruptcy plan,
and (2) the bankruptcy court’s determination that KK-PB’s claim as
a creditor was fraudulent, and therefore valued at zero. The district
court concluded that the two appeals were moot under Eleventh
Circuit precedent for a number of reasons. See generally In re Club
Associates, Inc., 956 F.2d 1065, 1069 n.11 (11th Cir. 1992) (setting
out relevant factors in equitable mootness analysis).
       First, KK-PB had not obtained a stay of either order—it had
unsuccessfully sought a stay of the valuation order at the district
court and the Eleventh Circuit and had unsuccessfully sought a stay
of the confirmation order in the district court but not the Eleventh
Circuit. The district court concluded that this factor did not weigh
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20-12361               Opinion of the Court                        3

strongly in favor of either side but tended to weigh in favor of dis-
missal due to KK-PB’s failure to seek a stay of the confirmation or-
der in the Eleventh Circuit. See D.E. 67 at 3-4.
       Second, the district court concluded—as the parties had
agreed—that the bankruptcy plan had been substantially consum-
mated under 11 U.S.C. § 1101. The debtor’s property (the hotel)
had been transferred to a third party; the debtor had disbursed al-
most $32 million to creditors; the debtor had paid $100,000 to the
Town of Palm Beach; and the debtor had paid a large amount of
fees to the U.S. Trustee for the management of the property. See
D.E. 67 at 4-5.
        Third, the district court concluded that the relief sought by
KK-PB—permitting its claim to be included in a class of allowed
secured claims and striking a certain contingent lien—could not be
granted because it was contrary to law. As to the merits of KK-PB’s
claim, the district court pointed out that the Eleventh Circuit had
already rejected KK-PB’s contention when it affirmed the sale of
the debtor’s property in 2019. See In re 160 Royal Palm, 785 F.
App’x 829 (11th Cir. 2019). With respect to the lien issue, the dis-
trict court explained that striking the contingent lien (which would
activate if the Supreme Court reversed the sale of the property)
would not aid KK-PB and would instead harm the purchaser of the
property. See D.E. 67 at 5-6.
       Applying de novo review, see Bennett v. Jefferson County,
899 F.3d 1240, 1246 (11th Cir. 2018), we find no error. For example,
with respect to consummation, the parties agreed that the plan has
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4                       Opinion of the Court                  20-12361

been substantially consummated. The fact that the debtor’s plan
did not involve unusually complex transactions does not bar a find-
ing of equitable mootness. See In re Hazon, 10 F.4th 1244, 1255
(11th Cir. 2021). And we are not convinced by KK-PB’s argument
that its so-called “narrowly-tailored remedy” would be easy to im-
plement. In fact, KK-PB itself suggests that it would have to pursue
the debtor’s bankruptcy counsel for a portion of their fees. See Ap-
pellant’s Br. at 17.
        KK-PB may be correct in arguing that the district court con-
flated the merits with equitable mootness when it reasoned that
the relief sought was contrary to law. Be that as it may, KK-PB does
not satisfactorily explain why its requested relief (which potentially
runs in the millions of dollars) would not create problems for oth-
ers.
       Given that the appeal of the confirmation order is equitably
moot, KK-PB’s appeal of the valuation order is constitutionally
moot. The confirmed plan, which stands, is binding on all parties
and payments contrary to the plan are prohibited. See 11 U.S.C. §
1141(a). There is no way to modify the plan, as KK-PB suggests, if
the appeal of the plan’s confirmation is equitably moot. See Mis-
sion Product Holdings, Inc. v. Tempnology, LLC, 139 S.Ct. 1652,
1660 (2019) (case is moot “only if it is impossible for a court to grant
any effectual relief whatever to [a party] assuming it prevails”) (in-
ternal quotation and citation omitted).
       AFFIRMED.