Court Opinion

ID: 772900
Source: CourtListenerOpinion
Date Created: 2012-04-18 11:18:38+00
Date Added: 2024-06-11T11:08:44.996254
License: Public Domain

246 F.3d 1332 (11th Cir. 2001)
In re:  OPTICAL TECHNOLOGIES, INC., Debtor.Delaine Gray, as Distribution Trustee for the Consolidated Debtors, Plaintiff- Appellant,v.Raymond Manklow, Jean Francois Vincens, Defendants-Appellees.
No. 00-14391.
United States Court of Appeals,Eleventh Circuit.
April 6, 2001.April 18, 2001.

Appeal from the United States District Court for the Middle District of  Florida. (No. 98-02382-CV-T-17B), Elizabeth A. Kovachevich, Chief Judge.
Before BLACK and MARCUS, Circuit Judges, and HANCOCK*, District Judge.
MARCUS, Circuit Judge:

1
This is an appeal from final summary judgment entered by the bankruptcy court  against Recomm Enterprises, Inc. and Recomm Operations, Inc. ("the Debtors") in  an adversary proceeding in which the Debtors sought to recover allegedly  fraudulent transfers, preference payments and damages for breaches of fiduciary  duty. The district court affirmed the bankruptcy court's order, after which the  Debtors appealed to this court. We agree with the analysis and well-reasoned  opinion of the district court and affirm, but take this opportunity to reiterate  the standard of review governing both this appeal and the appeal to the district  court from the bankruptcy court's entry of summary judgment.

I.

2
The relevant facts are straightforward. Prior to 1994, Raymond Manklow  ("Manklow") and Jean-Francois Vincens ("Vincens") were the sole shareholders of  the Debtors. In addition, they owned several other entities, known collectively  as "the Recomm Companies." Although there was a plan for a merger between the  Debtors and the Recomm Companies, no statutory merger was ever completed.  Manklow and Vincens sold their interests in the Recomm Companies to three Recomm  employees in 1994, and in 1996 the Recomm Companies and the Debtors filed for  bankruptcy.

3
In this adversary action, the Debtors seek to avoid allegedly fraudulent  transfers made by the Debtors to Manklow and Vincens between 1992 and 1995,  pursuant to 11 U.S.C.  547 and 548, and Fla. Stat.  726.105(1)(a)-(b). The  Debtors also allege that Vincens and Manklow breached a fiduciary duty owed to  Recomm Operations and its creditors.

4
Following discovery, Vincens and Manklow moved for summary judgment, arguing,  inter alia, that (1) the Debtors could not avoid the allegedly fraudulent or  preferential transfers because the transfers had actually been made by the  Recomm Companies, not by either of the Debtors, and the claims were therefore  not the property of either of the Debtors' bankruptcy estates; and (2) as to the  breach of fiduciary duty claim, there was insufficient evidence that Vincens and  Manklow qualified as "insiders" of Recomm Operations, a necessary element of the  claim. See 11 U.S.C.  547(b)(4)(B). The bankruptcy court agreed with Vincens  and Manklow on both issues and entered summary judgment against the Debtors.

5
On appeal to the district court, as well as to this Court, the crux of the  Debtors' argument is that summary judgment was improvidently granted because  there were genuine issues of material fact as to whether the Debtors owned the  claims to payments made by the Recomm Companies, and whether Vincens and Manklow  qualified as insiders.

II.

6
Under Fed.R.Civ.P. 56(c), made applicable to adversary proceedings and contested  matters in bankruptcy cases by Bank. R. 7056 and 9014, summary judgment is  proper "if the pleadings, depositions, answers to interrogatories, and  admissions on file, together with the affidavits, if any, show that there is no  genuine issue as to any material fact and that the moving party is entitled to  judgment as a matter of law." Fed. R. Civ. P 56(c); Celotex Corp. v. Catrett,  477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). " 'In making  this determination, the court must view all evidence and make all reasonable  inferences in favor of the party opposing summary judgment.' " Chapman v. AI  Transp., 229 F.3d 1012, 1023 (11th Cir.2000) (en banc) (citation omitted).  "Where the record taken as a whole could not lead a rational trier of fact to  find for the non-moving party, there is no 'genuine issue for trial.' "  Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct.  1348, 1356, 89 L.Ed.2d 538 (1986).

7
It is axiomatic that a bankruptcy court deciding a summary judgment motion, just  like a district court, must determine whether there are any genuine issues of  material fact. See Carey Lumber Co. v. Bell, 615 F.2d 370, 378 (11th Cir.1980)  (per curiam) (holding that a bankruptcy court that (1) determined that there  were no issues of material fact, (2) accepted all undisputed factual allegations  as true, and (3) found that summary judgment was warranted as a matter of law,  "followed the correct legal standard."). Like a district court, a bankruptcy  court may only grant summary judgment where there is no genuine issue of  material fact. See Fed.R.Civ.P. 56(c). Our law is also clear that an appellate  court reviews a bankruptcy court's grant of summary judgment de novo. See In re  Walker, 48 F.3d 1161, 1163 (11th Cir.1995) ("We review the bankruptcy court's  grant of summary judgment de novo, applying the same legal standards used by the  trial court."); In re Club Assocs., 951 F.2d 1223, 1229 (11th Cir.1992) (citing  In re Nash, 765 F.2d 1410, 1412 (9th Cir.1985) ("The bankruptcy court's grant of  summary judgment, affirmed by the district court, is subject to de novo  review.")).

8
To the extent, however, that the district court's opinion may be read to suggest  that appellate review of a bankruptcy court's entry of summary judgment may be  governed by a clearly erroneous standard,1 we take this opportunity to make  clear that both the district court and this Court review a bankruptcy court's  entry of summary judgment de novo. The district court relied on In re Club  Assocs., which explained that "factual findings by the bankruptcy court are  reviewed under the limited and deferential clearly erroneous standard." 951 F.2d  at 1228. While it is true that, in general, a district court reviews a  bankruptcy court's factual findings for clear error, we do not read In re Club  Assocs. to hold, nor could it be so read in light of our precedent, that the  standard of review for summary judgment, which by definition involves no  findings of fact, is anything other than de novo. See also Rosen v. Bezner, 996  F.2d 1527, 1530 n. 2 (3d Cir.1993) ("because summary judgment may only be  granted where there is no genuine issue of material fact, any purported 'factual  findings' of the bankruptcy court cannot be 'factual findings' as to disputed  issues of fact, but rather are conclusions as a matter of law that no genuine  issue of material fact exists."). Quite simply, our law is, and has been, that a  summary judgment ruling is reviewed de novo.

9
Our sister Circuits likewise have unanimously articulated the principle that  both the district court and the courts of appeal review a bankruptcy court's  entry of summary judgment de novo. See In re Blackwood Assocs., L.P., 153 F.3d  61, 67 (2d Cir.1998) ("[W]e review the district court's affirmance of the  bankruptcy court in accordance with our well established standards of review.  Specifically, we review a grant of summary judgment de novo ..."); In re Hudson,  107 F.3d 355, 356 (5th Cir.1997) (same); Southern Tech. College, Inc. v. Hood,  89 F.3d 1381, 1383 (8th Cir.1996); In re Slamans, 69 F.3d 468, 472 (10th  Cir.1995); In re Varrasso, 37 F.3d 760, 763 (1st Cir.1994); In re Batie, 995  F.2d 85, 88-89 (6th Cir.1993); Rosen, 996 F.2d at 1530; In re Knightsbridge  Development Co., 884 F.2d 145, 147 n. 3 (4th Cir.1989); In re Colonial Discount  Corp., 807 F.2d 594, 596 (7th Cir.1986); In re New England Fish Co., 749 F.2d  1277, 1280 (9th Cir.1984).

10
In the instant case, the bankruptcy court properly concluded that there were no  genuine issues of material fact and that summary judgment was appropriate as a  matter of law. The bankruptcy court made no findings of fact, nor could it, on  summary judgment, and accordingly, our review is de novo.

11
Having conducted a de novo review of the bankruptcy court's order, we agree with  the district court that summary judgment was properly granted as to all claims  in this case. As the bankruptcy court noted, the facts of this case were  essentially undisputed, and, even when viewed in the light most favorable to the  Debtors, are insufficient as a matter of law to establish that the Debtors owned  the claims arising from transfers made by the other Recomm Companies, or that  Vincens and Manklow were insiders of either of Recomm Operations.

12
Accordingly we affirm.

13
AFFIRMED.

NOTES:

*
  Honorable James H. Hancock, U.S. District Judge for the Northern District of  Alabama, sitting by designation.

1
  In laying out the standard of review, the district court stated, among other  things, that "[f]indings of fact by the bankruptcy judge shall be upheld on  appeal unless found to be clearly erroneous." In re Optical Technologies, Inc.,  252 B.R. 531, 533 (M.D.Fla.2000). The district court also observed that it  reviewed the bankruptcy court's conclusions of law de novo. Id. at 537.