In re Triumph Christian Ctr., Inc.

In re Triumph Christian Ctr., Inc.

Opinion

 [*482]  MEMORANDUM OPINION RELATING TO FOUNDATION CAPITAL RESOURCES, INC.'S MOTION TO DISMISS FOR SERIAL FILING

[Doc. No. 14]

I. Introduction

On February 4, 2013, Triumph Christian Center, Inc. (the Debtor) filed the instant Chapter 11 case. [Doc. No. 1]. The Debtor had previously been a debtor in a Chapter 11 case filed on December 7, 2010 [Case No. 10-41239, Doc. No. 1], and had obtained confirmation of its plan of reorganization in that case on August 23, 2011. [Case No. 10-41239, Doc. No. 66]. On February 11, 2013, Foundation Capital Resources, Inc. (FCR) filed its "Motion of Foundation Capital Resources, Inc. (FCR) to Dismiss for Serial Filing" (the Motion). [Doc. No. 14].

In the Motion, FCR seeks dismissal of the Second Case "for cause" pursuant to Federal Bankruptcy Rule 1017(f)(2) and 11 U.S.C. § 1112(b)(1). [Doc. No. 14, ¶ 8]. Specifically, FCR alleges that the Debtor has filed this second Chapter 11 case in bad faith, and therefore "cause" for dismissal exists  [**2] under section 1112(b). ¹ The Debtor contends that its serial filing of this second Chapter 11 case was necessitated by unanticipated changed circumstances, and therefore is not in bad faith.

On April 24, 2013, this Court held a hearing on the Motion. The Court heard testimony from one witness: the President of the Debtor, Pastor Ladell Graham. The Court also admitted FCR's exhibits one through ten and the Debtor's exhibits one through seventeen. For the reasons set forth herein, the Court finds that the Debtor's filing of the instant Chapter 11 case is an impermissible attempt to modify the plan in its prior Chapter 11 case, which has already been substantially consummated, in violation of section 1127(b) of the Bankruptcy Code. Further, the Debtor has not demonstrated unanticipated changed circumstances which would warrant this second Chapter 11 filing. For these reasons, and because of the presence of other indicators of bad faith, the Court finds that there is cause for dismissal  [**3] under section 1112(b)(1). Therefore, the Motion should be granted.

The Court now makes the following findings of fact and conclusions of law pursuant to Federal Rule of Bankruptcy Procedure 9014 and Federal Rule of Civil Procedure 52, as made applicable by Federal Rule of Bankruptcy Procedure 7052. ²

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