Clifton Capital Group, LLC v. Bradley Sharp
Trademark Patent JusticiabilityDoctri
Whether a creditor has Article III standing to challenge a bankruptcy court order awarding a bonus to the former Chapter 11 trustee when the creditor alleges the order will delay its receipt of funds under the bankruptcy plan
QUESTION PRESENTED Petitioner is one of the largest creditors in the Chapter 11 bankruptcy case of East Coast Foods, Inc., manager of the famed Roscoe’s House of Chicken & Waffles restaurant. To date—approaching six years after the bankruptcy plan was has not been paid a penny on its claim. Respondent, the former Chapter 11 trustee, on the other hand, not only received payment for the services he charged the bankruptcy estate, but a substantial unwarranted bonus ordered by the bankruptcy court. Petitioner challenged the bankruptcy court’s order awarding Respondent’s bonus. As one of the largest creditors in the bankruptcy case, the plain text of the Bankruptcy Code permits Respondent as a “party in interest” to “raise” and “be heard on any issue” in the Chapter 11 proceeding. 11 U.S.C. § 109. But the court of appeals did not reach the merits of Petitioner’s appeal and instead held that Petitioner lacked standing to challenge the bankruptcy court’s order awarding Respondent’s bonus. The question presented is: If a bankruptcy plan proposes to pay creditors in full with interest, does a creditor who alleges that a bankruptcy court order will delay its receipt of funds state an injury in fact sufficient to confer Article III standing to appeal the order? @)