Opinion
Case No. 06-12778.
5-13-2010
In re: CINCOM IOUTSOURCE, INC. Chapter 7, Debtor.
Presently before the Court is a Motion For Order Deeming Proof Of Claim Filed By D.B. Zwirn Special Opportunities Fund L.P. As Timely ("Motion") (Doc. 222) filed by D.B. Zwirn Special Opportunities Fund L.P. ("DBZ"). The chapter 7 trustee, Mark A. Greenberger, opposes the Motion. See Doc. 228.
December 26, 2006, was the deadline for filing a proof of claim. See Doc. 6. DBZ received timely notice of the claims bar date. Nonetheless, DBZ did not file a proof of claim until March 2, 2007. See Claim No. 11-1. DBZ's Motion asks the Court to deem its proof of claim timely filed.
Fed. R. Bankr. P. 3002(c) governs the time for filing claims in a chapter 7 case. Unless one of six exceptions applies, the claim must be filed within 90 days of the first date set for the meeting of creditors. DBZ does not suggest that one of the six exceptions applies. Instead, DBZ argues that its claim should be deemed timely as a matter of equity and due process pursuant to 11 U.S.C. § 105(a). Specifically, DBZ contends it had no way of knowing, prior to the claims bar date, that it possessed a claim against the Debtor.
Rule 3002(c) provides:
In a chapter 7 liquidation, chapter 12 family farmer's debt adjustment, or chapter 13 individual's debt adjustment case, a proof of claim is timely filed if it is filed not later than 90 days after the first date set for the meeting of creditors called under § 341(a) of the Code, except as follows: (1) A proof of claim filed by a governmental unit, other than for a claim resulting from a tax return filed under § 1308, is timely filed if it is filed not later than 180 days after the date of the order for relief. A proof of claim filed by a governmental unit for a claim resulting from a tax return filed under § 1308 is timely filed if it is filed no later than 180 days after the date of the order for relief or 60 days after the date of the filing of the tax return. The court may, for cause, enlarge the time for a governmental unit to file a proof of claim only upon motion of the governmental unit made before expiration of the period for filing a timely proof of claim. (2) In the interest of justice and if it will not unduly delay the administration of the case, the court may extend the time for filing a proof of claim by an infant or incompetent person or the representative of either. (3) An unsecured claim which arises in favor of an entity or becomes allowable as a result of a judgment may be filed within 30 days after the judgment becomes final if the judgment is for the recovery of money or property from that entity or denies or avoids the entity's interest in property. If the judgment imposes a liability which is not satisfied, or a duty which is not performed within such period or such further time as the court may permit, the claim shall not be allowed. (4) A claim arising from the rejection of an executory contract or unexpired lease of the debtor may be filed within such time as the court may direct. (5) If notice of insufficient assets to pay a dividend was given to creditors under Rule 2002(e), and subsequently the trustee notifies the court that payment of a dividend appears possible, the clerk shall give at least 90 days' notice by mail to creditors of that fact and of the date by which proofs of claim must be filed. (6) If notice of the time to file a proof of claim has been mailed to a creditor at a foreign address, on motion filed by the creditor before or after the expiration of the time, the court may extend the time by not more than 60 days if the court finds that the notice was insufficient under the circumstances to give the creditor a reasonable time to file a proof of claim.
The Motion also raises an excusable neglect argument pursuant to Fed. R. Bankr. P. 9006(b)(1). DBZ appears to have abandoned this argument. See Doc. 233 at 1-2. If not, the Court holds that Rule 9006(b)(1) is inapplicable to enlargement of the claims bar date in chapter 7 cases. See Fed. R. Bankr. P. 9006(b)(3) (limiting enlargement of the Rule 3002(c) bar date to the express grounds stated in Rule 3002(c)); see also Pioneer Investment Servs. Co. v. Brunswick Assocs. Ltd. Partnership, 507 U.S. 380, 389 n.4 (1993).
Absent one of the express exceptions set forth in Rule 3002(c), the vast majority of courts recognize no other exceptions to the 90-day requirement — equitable or otherwise. See e.g., In re Nyeste, 273 B.R. 148 (Bankr. S.D. Ohio 2001); In re Boudinot, 237 B.R. 413 (Bankr. S.D. Ohio 1999); see also In re Gardenhire, 209 F.3d 1145 (9th Cir. 2000); In re Greenig, 152 F.3d 631 (7th Cir. 1998); Jones v. Arross, 9 F.3d 79 (10th Cir. 1993).
DBZ cites a Supreme Court decision and two circuit decisions in support of the Motion. See Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306 (1950); United States v. Cardinal Mine Supply, Inc., 916 F.2d 1087 (6th Cir. 1990); In re Unroe, 937 F.2d 346 (7th Cir. 1991).
DBZ cites Mullane for the proposition that "[a]n elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections." See Mullane, 339 U.S. at 314. DBZ's reliance on the foregoing is misplaced because notice is not an issue in this case. DBZ does not dispute that it received timely notice of the bar date. Consequently, this case is distinguishable from the body of decisions that apply Mullane to the timeliness of bankruptcy claims where the claimant was not provided adequate notice of the bar date. See e.g., City of New York v. New York, N.H. & H.R. Co., 344 U.S. 293 (1953).
DBZ also cites U.S. v. Cardinal Mine Supply, 916 F.2d 1087 (6th Cir. 1990). Unlike DBZ, the claimant in Cardinal Mine did not receive timely notice of the bankruptcy. Therefore, Cardinal Mine is more akin to City of New York and its progeny. Moreover, Cardinal Mine was limited to a narrow issue that is irrelevant to this case: whether a tardily filed priority claim should be paid under 11 U.S.C. § 726(a)(1). DBZ has not filed a priority claim, nor has it asserted that it should be paid under § 726(a)(1). Lastly, Cardinal Mine has been rendered obsolete by the 1994 and 2005 amendments to § 726(a)(1). See In re Cincom iOutsource, Inc., 398 B.R. 236, 241-42 (Bankr. S.D. Ohio 2008).
Unroe addressed the issue of whether a claim that is untimely under Rule 3002(c) may be treated as timely, based upon equitable principles, where the claimant also filed a timely but unrelated claim. DBZ's claim is distinguishable from Unroe because DBZ did not file a separate claim, timely or otherwise. Moreover, Unroe expressly declined to address the instant issue, stating: "[w]e leave for another case the question of whether a judge in equity could permit an entirely new claim filed out of time." Id. at 350. Seven years later, the Seventh Circuit answered that question in the negative.
Our decision today deals with an issue which we have called attention to before but which has never been ruled upon until this date. In In re Unroe, for example, 937 F.2d 346 (7th Cir. 1991), we deferred the question of whether a court has equitable powers to allow a late-filed proof of claim outside the exceptions contained in Rule 3002(c). . . . We answer that question today: a bankruptcy judge is not vested with such equitable power.
Greenig, 152 F.3d at 635.
For the foregoing reasons, the Motion is hereby DENIED.
IT IS SO ORDERED.