In re Wallace, Rush, Schmidt, Inc.

• Decision Date: 28 December 2022
• Docket Number: 17-10698
• Parties: IN RE: WALLACE, RUSH, SCHMIDT, INC. DEBTOR.
• Court: U.S. Bankruptcy Court — Eastern District of Louisiana

IN RE: WALLACE, RUSH, SCHMIDT, INC. DEBTOR.

No. 17-10698

United States Bankruptcy Court, E.D. Louisiana

December 28, 2022

CHAPTER 11

SECTION A

MEMORANDUM OPINION AND ORDER

MEREDITH S. GRABILL UNITED STATES BANKRUPTCY JUDGE

Before the Court is the Debtor's Motion To Re-Open Chapter 11 Case To Enforce Plan Provisions and the accompanying memorandum in support (together, the "Motion"), [ECF Docs. 540 & 541], filed by Wallace, Rush, Schmidt, Inc. (the "Reorganized Debtor") pursuant to 11 U.S.C. § 350(b). An opposition to the Motion has been filed by Jennifer Guidry Chauvin (individually and as the administratrix for the estate of Spencer Chauvin and as tutrix for Jade Michel Chauvin and Judge Lewis Chauvin), Princess Sherrod (on behalf of minor child A.S. David Jones), Nicholas and Rebekah Saale (individually and on behalf of minor child C.S. Sulma Almendarez-Rivas), Jenyfer Espinal Almendare (individually and on behalf of L.E.A.), Emiliano Acosta (individually and on behalf of E.A.), Keyla Gonzalez, Maiela Bardales, Kenia Gonzalez, Glenny Berroa, Fatima Berroa, Daniella Macial De Souza (on behalf of her minor child V.M.K.), and Marcus Tate and Christina Tate (individually and on behalf of minor children M.T., A.T. and M.J.) (collectively, the "Claimants"). [ECF Doc. 548]. The Reorganized Debtor filed a reply brief in support of the Motion. [ECF Doc. 550].

Through the Motion, the Reorganized Debtor asks this Court to reopen the main case so that the Reorganized Debtor can file an adversary proceeding seeking turnover of funds currently

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held in a fund established by the confirmed plan of reorganization in this case for the benefit of the Claimants. For the reasons discussed below, the Court DENIES the Motion.

JURISDICTION AND VENUE

This Court has jurisdiction to grant the relief provided for herein pursuant to 28 U.S.C. § 1334. "[T]he bankruptcy court retains post-confirmation jurisdiction to interpret and enforce its own orders in aid of their proper execution." In re Johns-Manville Corp., 97 B.R. 174, 180 (Bankr. S.D.N.Y .1989); see also Wildwood Prop. Owners Ass'n v. Bordelon (In re Wildwood Prop. Owners Ass'n), Adv. No. 14-3292, 2017 WL 3189874, at *2 (Bankr.S.D.Tex. July 25, 2017) (citing Travelers Indem. Co. v. Bailey, 557 U.S. 137, 151 (2009); Baker v. Baker (In re Baker), 593 Fed.Appx. 416, 417 (5th Cir. 2015)). Venue is proper before this Court pursuant to 28 U.S.C. §§ 1408 and 1409.

BACKGROUND

Prior to the Debtor filing its petition for bankruptcy relief, the Claimants asserted tort claims against the Debtor and others in Louisiana state court emanating from an August 2016 accident involving multiple serious injuries and death. The Debtor sought bankruptcy protection two years after the 2016 accident before any judgment was rendered in those consolidated state court actions or a settlement was reached with the Claimants.

The Debtor filed its Third Amended Plan of Reorganization Propounded by Debtor on June 20, 2018 (the "Plan"). [ECF Doc. 359]. The Debtor modified that Plan three times prior to confirmation: first on June 21, 2018 (the "First Plan Modification"), [ECF Doc. 361]; again on August 30, 2018 (the "Second Plan Modification"), [ECF Doc. 417]; and for the final time on September 6, 2018 ("Third Plan Modification"), [ECF Doc. 433]. This Court confirmed the Plan on September 13, 2018. [ECF Doc. 438]. The Confirmation Order specifically references and

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incorporates the Second Plan Modification and the Third Plan Modification, but not the First Plan Modification. See id. (referencing ECF Docs. 417 & 433).^[1]

The Third Plan Modification classified the Claimants in Class 6 in the Plan and provided that any judgment or settlement of the Claimants' claims "shall be covered and paid by [the Debtor's] insurers," adding that "Debtor shall pay only any excess...