Court Opinion

ID: 181024
Source: CourtListenerOpinion
Date Created: 2010-12-14 15:40:54+00
Date Added: 2024-06-11T17:25:53.786981
License: Public Domain

10-455-bk and 10-391-bk
         In Re: Park Avenue Garage, LLC

                                   UNITED STATES COURT OF APPEALS
                                       FOR THE SECOND CIRCUIT

                                                 SUMMARY ORDER

R ULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT . C ITATION TO A SUMMARY ORDER FILED ON OR AFTER J ANUARY 1,
2007, IS PERMITTED AND IS GOVERNED BY F EDERAL R ULE OF A PPELLATE P ROCEDURE 32.1 AND THIS COURT ’ S L OCAL R ULE 32.1.1.
W HEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT , A PARTY MUST CITE EITHER THE F EDERAL A PPENDIX OR AN
ELECTRONIC DATABASE ( WITH THE NOTATION “ SUMMARY ORDER ”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON
ANY PARTY NOT REPRESENTED BY COUNSEL .

 1            At a stated term of the United States Court of                                      Appeals
 2       for the Second Circuit, held at the Daniel Patrick                                      Moynihan
 3       United States Courthouse, 500 Pearl Street, in the                                      City of
 4       New York, on the 14 th day of December, two thousand                                    and ten.
 5
 6       PRESENT: WILFRED FEINBERG,
 7                BARRINGTON D. PARKER,
 8                RICHARD C. WESLEY,
 9                         Circuit Judges.
10
11
12
13       IN RE: PARK AVENUE GARAGE, LLC,
14
15                                       Debtor.
16
17       _______________________________________
18
19       390 PARK AVENUE ASSOCIATES, LLC,
20
21                                       Claimant-Appellant,
22
23                       -v.-                                           10-455-bk, 10-391-bk
24
25       PARK AVENUE GARAGE, LLC,
26
27                                       Debtor-Appellee.
28
29
30
 1   FOR APPELLANT:       RALPH BERMAN, (Adrian Zuckerman, on the
 2                        brief), Epstein, Becker & Green, P.C.,
 3                        New York, NY.
 4
 5   FOR APPELLEE:        ROBERT R. LEINWAND, Robinson, Brog,
 6                        Leinwand, Greene, Genovese & Gluck P.C.,
 7                        New York, NY.
 8
 9        Appeal from the United States District Court for the
10   Southern District of New York (Berman, J.).
11
12        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED

13   AND DECREED that the judgment of the district court be

14   AFFIRMED. 1

15        Claimant-Appellant, 390 Park Avenue Associates, LLC,

16   (“Landlord” or “Appellant”) appeals from a December 23, 2009

17   judgment of the United States District Court for the

18   Southern District of New York (Berman J.), which affirmed

19   two orders, dated June 1, 2009 and June 18, 2009, of the

20   Bankruptcy Court for the Southern District of New York

21   (Drain, J.). The June 1, 2009 order, as clarified by the

22   June 18, 2009 order, authorized Debtor-Appellee, Park Avenue

23   Garage, LLC, (“Debtor”) to assume an unexpired non-

24   residential lease and imposed certain additional obligations

25   upon Debtor.     We assume the parties’ familiarity with the

          1
           This Order disposes of both appeals corresponding to
     docket numbers 10-455 and 10-391. As both parties
     recognize, these two appeals involve overlapping issues and
     arguments.

                                     2
1   underlying facts, the procedural history, and the issues

2   presented for review. 2

3       The bankruptcy court did not err in authorizing Debtor

4   to assume the lease pursuant to Section 365(a) of the

5   Bankruptcy Code.   11 U.S.C. § 365(a). 3   First the bankruptcy

6   court’s conclusion that assumption of the lease, in light of

        2
          During the pendency of this appeal, on motion by the
    United States Trustee, the bankruptcy court dismissed
    Debtor’s Chapter 11 petition. The dismissal order provides
    that “all orders heretofore entered in this Chapter 11 case
    shall remain in full force and effect” except as otherwise
    provided by law. “[B]ankruptcy courts retain jurisdiction
    after a case has been dismissed or closed to interpret or
    enforce previously entered orders.” Gulf Ins. Co. v.
    Glasbrenner, 343 B.R. 47, 56 (S.D.N.Y. 2006) (quoting In re
    Williams, 256 B.R. 885, 892 (8th Cir. BAP 2001)). This
    Court has the authority to grant Appellant the relief it
    seeks. Further, the bankruptcy court has the authority to
    interpret the effect of our decision upon the parties’
    rights and liabilities which have been altered by the
    bankruptcy proceedings and which, as provided in the
    dismissal order, remain effective to this date. Therefore,
    we reject Debtor’s argument that this appeal is moot.
        3
           “The rulings of a district court acting as an
    appellate court in a bankruptcy case are subject to plenary
    review.” In re Stoltz, 315 F.3d 80, 87 (2d Cir. 2002).
    Consequently, “[i]n an appeal from a district court’s review
    of a bankruptcy court decision, we review the bankruptcy
    court decision independently, accepting its factual findings
    unless clearly erroneous but reviewing its conclusions of
    law de novo.” In re Enron Corp., 419 F.3d 115, 124 (2nd
    Cir. 2005). “[T]he issue raised by the [Bankruptcy] Court’s
    finding . . . that ‘adequate assurance’ existed is one of
    fact” and should be reviewed under the “clearly erroneous
    standard for review.” In re Sanshone Worldwide Corp., 139
    B.R. 585, 590 (S.D.N.Y. 1992).

                                   3
1    the totality of the circumstances, would benefit Debtor

2    represents a valid exercise of the court’s “business

3    judgment.”   See In re U.S. Wireless Data, Inc., 547 F.3d

4    484, 488 (2d Cir. 2008) (per curiam); see also In re Orion

5    Pictures Corp., 4 F.3d 1095, 1099 (2d Cir. 1993).    The

6    bankruptcy court’s determination that assumption of the

7    lease would allow Debtor to remain a going concern, and in

8    combination with capital infusions by Mr. Sopher,

9    potentially allow Debtor to return to profitability within

10   the remaining life of the lease was not clearly erroneous.

11       Second, the bankruptcy court concluded that the

12   combination of (1) Mr. Sopher’s financial wherewithal and

13   commitment to future performance; (2) “Debtor’s performance

14   obligations and resources,” including an additional three-

15   month security deposit; and (3) the condition, provided in

16   the bankruptcy court orders, that Debtor’s failure to

17   perform certain court imposed obligations would result in

18   rejection of the lease provided Landlord adequate assurance

19   of prompt cure of past defaults and adequate assurance of

20   future performance in satisfaction of Section 365(b)(1) of

21   the Bankruptcy Code.   11 U.S.C. § 365(b)(1).   On this

22   record, the bankruptcy court’s finding of the existence of

                                   4
1    adequate assurance was not clearly erroneous.   See In re M.

2    Fine Lumber Co., 383 B.R. 565, 572–73 (Bankr. E.D.N.Y.

3    2008).

4        We have considered all of Appellant’s arguments on

5    appeal and find them to be without merit.   For the foregoing

6    reasons, the judgment of the district court is hereby

7    AFFIRMED.

 8
 9                              FOR THE COURT:
10                              Catherine O’Hagan Wolfe, Clerk
11
12

                                  5