Malbrough v. Stanley of New Orleans, LLC et al

Filing 12

ORDER AND REASONS granting 11 MOTION to Lift Stay filed by Ralph Malbrough. Signed by Chief Judge Sarah S. Vance on 9/2/15.(jjs)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
RALPH MALBROUGH

CIVIL ACTION

VERSUS

NO: 14-2321

SCOTT BOSWELL ENTERPRISES, ET AL.

SECTION: R(1)

ORDER AND REASONS
Plaintiff Ralph Malbrough moves the Court to lift the automatic stay in this matter
under 11 U.S.C. § 362.1 For the following reasons, the Court grants the motion.

I.

BACKGROUND
On October 9, 2014, plaintiff Ralph Malbrough filed this employment suit, alleging

that his employers--defendants Stanley of New Orleans, LLC; The Paint Factory, LLC;
Stella, LLC; and Professional Management Services Group d/b/a SCI Companies--violated
the Americans with Disabilities Act, 42 U.S.C. § 12101, et seq.2 On October 30, 2014,
Stanley and The Paint Factory notified the Court they are debtors in Chapter 11 Bankruptcy
proceedings.3 On November 7, 2014, the Court ordered the matter administratively stayed
as to Stanley and The Paint Factory.4
Defendant Scott Boswell Enterprises, LLC is also a debtor in ongoing bankruptcy
proceedings.5 According to Malbrough’s amended complaint, Scott Boswell Enterprises

1

R. Doc. 11.

2

R. Doc. 1.

3

R. Doc. 3; see also Bankruptcy Case Nos. 14-11510, 14-11506, 14-11508

(E.D. La.).
4

R. Doc. 4.

5

See R. Doc. 11-1.

was also Malbrough’s employer under the Americans with Disabilities Act. Malbrough did
not name Scott Boswell Enterprises as a defendant in his original complaint.6
On March 9, 2015, Malbrough moved the bankruptcy court to lift the pending
automatic stay as to Scott Boswell Enterprises, Stanley, and The Paint Factory.7 Finding
good cause to lift the stay, the bankruptcy court granted Malbrough’s motions on April 21,
2015, and modified the stay to allow Malbrough to liquidate his federal employment claims
against Scott Boswell Enterprises, Stanley, and The Paint Factory.8 The bankruptcy court
ordered that any judgment rendered against any of these debtors shall be enforced only
through the claims process in the debtor’s bankruptcy proceeding.9
On June 24, 2015, Malbrough filed an amended complaint, adding Scott Boswell
Enterprises as a defendant in his Americans with Disabilities lawsuit.10 Malbrough now
moves the Court to lift the pending stay of this action.11 Defendants do not oppose the
motion.

II.

DISCUSSION
Section 362 of Title 11 of the Unites States Code provides that a petition for

bankruptcy operates as a stay of “the commencement or continuation, including the
issuance or employment of process, of a judicial, administrative, or other action or

6

See id.

7

See R. Doc. 11-2; R. Doc. 11-3; R. Doc. 11-4.

8

See R. Doc. 11-2; R. Doc. 11-3; R. Doc. 11-4.

9

See R. Doc. 11-2; R. Doc. 11-3; R. Doc. 11-4.

10

See R. Doc. 8.

11

R. Doc. 11.

2

proceeding against the debtor that was or could have been commenced before the
commencement of the [bankruptcy case.]” 11 U.S.C. § 362(a)(1). Upon filing of the
bankruptcy petition, the section 362 stay automatically applies to all actions against the
debtor. The automatic stay remains in force until a federal court either disposes of the case,
see U.S.C. § 362(c)(2), or lifts the stay, see § 362(d)-(f).
The bankruptcy court in Scott Boswell Enterprises’s, Stanley’s, and The Paint
Factory’s Chapter 11 proceedings found good cause to modify the automatic stay under 11
U.S.C. § 362. The Court lifted the stay as to those debtors to allow Malbrough to liquidate
his federal employment claims.12 Defendants neither oppose Malbrough’s motion nor argue
that the bankruptcy court abused its discretion by lifting the automatic stay. Accordingly,
this Court will lift the stay as well. See, e.g., In re Butan Valley, N.V., No. 07-36856, 2009
WL 6509349, at *3-4 (S.D. Tex. Sept. 11, 2009) (affirming bankruptcy court’s decision to
lift an automatic stay because appellant failed to show that bankruptcy court abused its
discretion). Therefore, the Court grants Malbrough’s motion.

III.

CONCLUSION
For the foregoing reasons, the Court GRANTS Ralph Malbrough’s Motion to Lift

Stay.

2nd
New Orleans, Louisiana, this _______ day of September, 2015.
___________________________________
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE

12

See R. Doc. 11-2; R. Doc. 11-3; R. Doc. 11-4.

3