Eddleman v. United States Dep't of Labor
United States Court of Appeals for the Tenth Circuit
January 15, 1991, Filed
[*783] McKAY, Circuit Judge
This appeal arises from an attempt by the appellant, United States Department of Labor ("DOL"), to maintain an administrative action against a chapter 11 debtor. The United States Bankruptcy Court for the District of Colorado ruled that DOL's action was stayed by the automatic stay provision of the Bankruptcy Code, and the district court affirmed. We reverse.
Appellees James and Jane Eddleman owned a mail-hauling [**2] business. They did most of their work under a contract with the United States Postal Service. On August 6, 1986, the Eddlemans filed a petition for relief under chapter 11 of the Bankruptcy Code. See generally 11 U.S.C. §§ 1101-1174 (1988). They continued to operate the business as debtors-in-possession.
On May 27, 1987, DOL filed an administrative action against the Eddlemans, alleging pre-petition violations of the Service Contract Act ("SCA"), 41 U.S.C. §§ 351-358 (1988). The SCA requires all federal government contractors to pay certain minimum wages and fringe benefits. See 41 U.S.C. § 351. DOL alleges that the Eddlemans underpaid workers and failed to keep adequate records of hours worked and wages paid.
As part of the administrative enforcement action, DOL sought to liquidate claims for back wages due the Eddlemans' employees. DOL also sought to include the Eddlemans on an official list of SCA violators. Persons on the list are debarred from contracting with the government for three years. 41 U.S.C. § 354. If debarred under section 354, the Eddlemans stood to lose the benefit of renewal options included in their contract.
[**3] The Eddlemans responded by filing this adversary proceeding in bankruptcy court, requesting the court to enforce the automatic stay provision of the Bankruptcy Code against the DOL's administrative action. See 11 U.S.C. § 362 (1988). The Eddlemans sought, and were granted, a "Preliminary Injunction to Enjoin Violation of Automatic Stay." The Eddlemans also sought damages under 11 U.S.C. § 362(h) (1988) for DOL's alleged willful violation of the automatic stay. Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.
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923 F.2d 782 *; 1991 U.S. App. LEXIS 377 **; 118 Lab. Cas. (CCH) P35,454; 30 Wage & Hour Cas. (BNA) 209; Bankr. L. Rep. (CCH) P73,781; 24 Collier Bankr. Cas. 2d (MB) 822; 21 Bankr. Ct. Dec. 454; 8 Colo Bankr Ct Rep 83
C. JAMES EDDLEMAN also known as Jim Eddleman; JANE B. EDDLEMAN, d/b/a J & J Cattle Company, Inc. and Blue Fin Transport, Plaintiffs-Appellees, v. UNITED STATES DEPARTMENT OF LABOR, Defendant-Appellant
Prior History: [**1] Appeal from the United States District Court for the District of Colorado; D.C. Civil No. 87-C-1891.
Disposition: Reversed and Remanded.
automatic stay, bankruptcy court, district court, immunity, exemption, orders, power to regulate, proceedings, injunction, circuit court, administrative action, deny relief, final order, merits, enforcement proceeding, government action, regulatory action, collateral, violations, affirming, appellate jurisdiction, automatic, back-pay, appeals, damages, rights
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