Court Opinion

ID: 65514
Source: CourtListenerOpinion
Date Created: 2010-04-26 05:59:39+00
Date Added: 2024-06-11T17:20:38.853177
License: Public Domain

[DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS

                   FOR THE ELEVENTH CIRCUIT              FILED
                     ________________________   U.S. COURT OF APPEALS
                                                  ELEVENTH CIRCUIT
                                                       Aug. 27, 2008
                           No. 07-14974           THOMAS K. KAHN
                     ________________________         CLERK

                         D. C. Docket Nos.
                        07-01455-CV-WSD-1
                         05-12515-BKC-CR

In Re: ALLIED HOLDING, INC.,

Debtor.

VIRTUS CAPITAL LP,
HAWK OPPORTUNITY FUND, L.P.,

                                                 Plaintiffs-Appellants,

                               versus

ALLIED HOLDING, INC.,
TEAMSTERS NATIONAL AUTOMOBILE TRANSPORTATION
    INDUSTRY NEGOTIATING COMMITTEE,
YUCAIPA AMERICAN ALLIANCE FUND I, LP,
YUCAIPA TRANSPORT, LLC,

                                                Defendants-Appellees.
                              ________________________

                      Appeal from the United States District Court
                         for the Northern District of Georgia
                           _________________________

                                    (August 27, 2008)

Before WILSON and PRYOR, Circuit Judges, and MIDDLEBROOKS,* District
Judge.

PER CURIAM:

       Allied Holding filed for voluntary bankruptcy pursuant to Chapter 11 of the

Bankruptcy Code, 11 U.S.C. § 301, on July 31, 2005. Virtus Capital and Hawk

Opportunity Fund are shareholders of Allied, whose shares were deemed worthless

by Allied’s Plan of Reorganization (the “Plan”).

       The bankruptcy court confirmed the Plan on May 18, 2007. Three days

later, Virtus and Hawk appealed the bankruptcy court’s order to the district court.

They did not seek a stay with the bankruptcy court until June 25, 2007. The stay

was denied, and Virtus and Hawk failed to request a stay with the district court.

On September 29, 2007, the district court dismissed their appeal as equitably moot,

finding that the Plan had been “substantially consummated” and that third parties

had acted in substantial reliance on it. Upon careful review of the record and the

       *
          Honorable Donald M. Middlebrooks, United States District Judge for the Southern
District of Florida, sitting by designation.

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parties’ briefs, and after hearing oral argument, we affirm.

      Considering all the circumstances, we agree with the district court that the

Plan has been so substantially consummated that effective relief is no longer

available. Several major transactions have already been executed pursuant to the

Plan. If Virtus and Hawk were granted cash or shares in the reorganized Allied, or

if the Plan’s release provision were invalidated, such relief would undermine the

reasonable expectations of the stockholders and creditors who carefully negotiated

and relied on the deal struck by the Plan. Accordingly, Virtus and Hawk’s appeal

is equitably moot. See In re Club Assocs., 956 F.2d 1065, 1069 (11th Cir. 1992).

      AFFIRMED.

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