In Re: Regina Heisler
Filing
43
ORDER AND REASONS: IT IS ORDERED that the bankruptcy court's August 13, 2021 Memorandum Opinion and Order is AFFIRMED IN ALL RESPECTS. IT IS FURTHER ORDERED that Appellant Regina Heisler's appeal is HEREBY DISMISSED WITH PREJUDICE. Signed by Judge Susie Morgan on 3/29/2022.(pp)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
IN RE:
REGINA B. HEISLER
CIVIL ACTION
NO. 21-1636
SECTION: “E” (5)
ORDER AND REASONS
This matter is before the Court on review from the U.S. Bankruptcy Court. The
chapter 7 Debtor Regina Heisler (“Heisler”) appeals the Bankruptcy Court’s August 13,
2021 Memorandum Opinion and Order1 overruling Heisler’s objection to the proof of
claim filed by Appellee Girod LoanCo, L.L.C. (“Girod”), and allowing Girod’s proof of
claim to proceed forthwith. Heisler filed an Opening Appellant’s Brief on November 18,
2021.2 Girod filed an Appellee’s Brief on December 17, 2021.3 Heisler filed a reply brief.4
The Court, having considered the briefing and the designation of the record below,
issues its Order and Reasons AFFIRMING IN ITS ENTIRETY the Bankruptcy Court’s
August 13, 2021 Memorandum Opinion and Order.
BACKGROUND5
On August 27, 2020. Appellant Regina Heisler filed a petition for bankruptcy
under chapter 11. On September 28, 2020, the chapter 11 proceeding was converted into
a liquidation case under chapter 7. On October 21, 2020, Girod filed a proof of claim in
In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 402 (Bankr. E.D.La. 2021).
R. Doc. 14.
3 R. Doc. 17.
4 R. Doc. 18.
5 The backgrounds of the state court actions referenced herein are set forth more fully in the bankruptcy
court’s August 13, 2021 Memorandum Opinion and Order. See In re Regina Berglass Heisler, No. 20-11509
at R. Doc. 402 (Bankr. E.D. La. 2021).
1
2
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the bankruptcy in the amount of $7,869,608.10.6 Heisler filed an objection to Girod’s
proof of claim.7 Girod filed a response to Heisler’s objection.8 On June 23, 2021, the
bankruptcy court held a hearing on Heisler’s objection to Girod’s proof of claim.9 On July
7, 2021, Girod filed a supplemental brief in opposition to Heisler’s objection to the proof
of claim.10 On August 13, 2021, the bankruptcy court issued a written “Memorandum
Opinion and Order” determining that an evidentiary hearing was not required to resolve
Heisler’s objection to Girod’s proof of claim, and determining that Heisler’s objection
should be overruled and Girod’s proof of claim allowed in its entirety.11
On August 27, 2021, Heisler filed a Notice of Appeal in this Court, notifying the
Court of her election to appeal the bankruptcy court’s August 13, 2021 Memorandum
Opinion and Order.12 On November 18, 2021, Heisler filed an “Appellant’s Opening
Brief.”13 On December 17, 2021, Girod filed its Appellee’s brief.14 On January 3, 2021,
Heisler filed a reply brief.15
Girod’s proof of claim is based on eight promissory notes and related agreements.
Heisler’s objection is lodged with respect to seven of the eight promissory notes. As a
result, the Court need not address the eighth promissory note, which is unobjected to and
not at issue in this appeal.16 The seven promissory notes at issue were executed by
Appellant Regina Heisler as borrower in favor of First NBC Bank (“FNBC”). Girod
In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 135-2.
Id. at R. Doc. 348.
8 Id. at R. Doc. 369.
9 See id. at R. Doc. 378.
10 Id. at R. Doc. 385.
11 Id. at R. Doc. 402.
12 R. Doc. 1.
13 R. Doc. 14.
14 R. Doc. 17.
15 R. Doc. 18.
16 The promissory note which is not at issue in this appeal was executed by Levy Gardens Partner 2007, L.P.
as borrower in favor of FNBC, with Appellant Regina Heisler as guarantor.
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purchased the notes, collateral, and related agreements from the Federal Deposit
Insurance Corporation in its capacity as receiver for FNBC.17 Effective November 13, 2017,
the FDIC assigned and transferred ownership of the promissory notes, collateral, and
related agreements to Girod.
Six of the promissory notes at issue were executed by Heisler and were secured by
mortgages on immovable property located at 836-844 Baronne Street, New Orleans,
Louisiana and immovable property located at 4041 Williams Boulevard, Kenner,
Louisiana. These six notes were at issue in an executory process foreclosure action styled
Girod LoanCo, LLC v. Regina B. Heisler, Individually and as Succession
Representative/Executrix of the Succession of Frederick P. Heisler, Case No. 793-014
“D,” 24th Judicial District Court, Parish of Jefferson, State of Louisiana. Girod filed a
verified petition for foreclosure by executory process, and, on June 21, 2019, the 24th JDC
signed an order of seizure and sale in favor of Girod.18 Heisler did not file an injunction
to arrest the seizure and sale or file a suspensive appeal from the order of seizure and sale.
The Louisiana Supreme Court denied Heisler’s application for supervisory writs on
January 20, 2021.19
The seventh promissory note at issue was executed by Regina Heisler in favor of
FNBC and was secured by funds in a brokerage account owned by Regina Heisler at
Charles Schwab & Co., Inc. This promissory note was at issue in a concursus proceeding
styled Charles Schwab & Co. Inc. v. Girod LoanCo, LLC and Regina B. Heisler, No. 2018-
FNBC was closed and liquidated in 2017.
Girod attached a copy of its verified petition for foreclosure by executory process to its supplemental
opposition to Heisler’s objection to the proof of claim. See In re Regina Berglass Heisler, No. 20-11509 at
R. Doc. 385-1.
19 Girod filed a “Notice of Louisiana Supreme Court Writ Applications Denials” in the bankruptcy case and
attached copies of the writ application denials by the Louisiana Supreme Court to the notice. See id. at R.
Doc. 207-1 at p. 2.
17
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4693 “N,” Civil District Court, Parish of Orleans, State of Louisiana. On May 11, 2018,
Charles Schwab initiated the concursus proceeding to resolve the competing claims
between Girod and Regina Heisler over the funds in the Schwab account. Girod claimed
the funds by virtue of its status as holder of the promissory note and the perfected security
interest in the Schwab account; Heisler claimed the funds by virtue of her ownership of
the account. Girod filed a Motion for Summary Judgment in the Concursus Action on
April 16, 2019 (the “Girod MSJ”). On June 21, 2019, Judge Julien of the Civil District
Court of the Parish of Orleans found that Girod had the superior claim to the funds in the
Schwab account and granted Girod’s motion for summary judgment.20 A final judgment
to that effect was signed by Judge Julien on September 5, 2019.21 Heisler did not file an
appeal of the CDC’s ruling through the Louisiana appellate court system. The Louisiana
Supreme Court denied Heisler’s application for supervisory writs on January 20, 2021.22
Heisler filed a petition within the Succession of Frederick P. Heisler, No. 20073249 “N”, Civil District Court, Parish of Orleans, State of Louisiana, seeking a declaratory
judgment that all promissory notes held by Girod are invalid for lack or failure of
consideration.23 Girod filed an exception of lis pendens, arguing that the validity of the
promissory notes was already litigated and decided in the executory process foreclosure
action in the 24th Judicial District Court for the Parish of Jefferson, and in the concursus
action in the Civil District Court for the Parish of Orleans. On January 2, 2020, Judge
Julien signed a final judgment granting Girod’s exception of lis pendens and dismissing
See In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 385-3.
Girod attached a copy of this final judgment to its supplemental opposition to Heisler’s objection to the
proof of claim. See id.
22 Id. at R. Doc. 207-1 at p. 1.
23 Girod attached a copy of Heisler’s petition for declaratory judgment to its supplemental opposition to
Heisler’s objection to the proof of claim. See id. at R. Doc. 385-9.
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Heisler’s petition for declaratory judgment.24 Heisler did not file an appeal of the
judgment signed by Judge Julien. The Louisiana Supreme Court denied Heisler’s
application for supervisory writs on January 20, 2021.25
JURISDICTION AND STANDARD OF REVIEW
The court has jurisdiction over this appeal pursuant to 28 U.S.C. § 158(a)(1), and
in reviewing the findings of a bankruptcy court, a district court acts in an appellate
capacity.26 A party aggrieved by a bankruptcy court’s ruling may appeal to the district
court.27 The district court reviews the bankruptcy court’s findings of fact for clear error
and its conclusions of law de novo.28 “The res judicata effect of a prior judgment is a
question of law that we review de novo.”29 A factual finding is clearly erroneous when the
district court is left with the “definite and firm conviction, in light of the entire record,
that a mistake has been made.”30 The district court may correct a factual finding
predicated on an erroneous interpretation of law.31 A bankruptcy court’s decision to
conduct or refrain from conducting an evidentiary hearing on an objection to a proof of
claim is reviewed for abuse of discretion.32
24 Girod attached a copy of this judgment to its supplemental opposition to Heisler’s objection to the proof
of claim. See id. at R. Doc. 385-6.
25 Id. at R. Doc. 207-1 at p. 3.
26 See Perry v. Dearing, 345 F.3d 303, 308–09 (5th Cir.2003).
27 See 28 U.S.C. § 158(a).
28 In re Green Hills Dev. Co., 741 F.3d 651, 654 (5th Cir. 2014); see also FED. R. BANKR. P. 8013.
29 Dotson v. Atl. Specialty Ins. Co., 24 F.4th 999, 1002 (5th Cir. 2022).
30 In re MBS Mgmt. Servs., Inc., 690 F.3d 352, 354 (5th Cir. 2012) (quoting Oreck Direct, LLC v. Dyson,
Inc., 560 F.3d 398, 401 (5th Cir. 2009)).
31 See In re Coston, 991 F.2d 257, 261 (5th Cir. 1993).
32 In re Nelson, 621 B.R. 542, 553 (B.A.P. 1st Cir. 2020).
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LAW AND ANALYSIS
The bankruptcy court did not abuse its discretion in determining an
evidentiary hearing was not necessary to decide the claim objection.
An objection to a proof of claim initiates a contested matter.33 Federal Rule of
Bankruptcy Procedure 9014 sets forth the procedure applicable to contested matters.34
Rule 9014 requires a contested matter to be resolved after notice and an opportunity to
be heard.35 However, “[t]his does not necessarily mean that the Debtor was entitled to an
evidentiary hearing,” as there is “[n]othing in the plain language of Bankruptcy Rule 9014
suggests that the hearing on an objection to claim must be an evidentiary hearing.”36 Rule
9014’s “concept of notice and a hearing is a flexible one.”37 Moreover, 11 U.S.C. § 102(1)(A)
provides that the phrase “after notice and a hearing,” “means after such notice as is
appropriate in the particular circumstances, and such opportunity for a hearing as is
appropriate in the particular circumstances.”38
Heisler argues the Bankruptcy Court erred in refusing to hold an evidentiary
hearing on Girod’s proof of claim and Heisler’s objection thereto.39 Heisler argues she has
never had her day in court, and that a contested proof of claim “must be contested in a
court of law with the litigants presenting evidence.”40 Heisler fails to cite any statutory or
jurisprudential authority supporting the proposition that a contested proof of claim may
only be resolved after presentation of evidence. Indeed, the above-cited authority
33 Lundell v. Anchor Constr. Specialists, Inc. (In re Lundell), 223 F.3d 1035, 1039 (9th Cir. 2000) (quoting
Fed. R. Bankr. P. 9014 advisory committee notes).
34 See Fed. R. Bankr. P. 9014.
35 See id.
36 In re Nelson, 621 B.R. 542, 560 (B.A.P. 1st Cir. 2020).
37 Id. (quoting Gonzalez-Ruiz v. Doral Fin. Corp. (In re Gonzalez-Ruiz), 341 B.R. 371, 381 (B.A.P. 1st Cir.
2006)).
38 11 U.S.C.A. § 102(1)(A).
39 R. Doc. 14 at p. 9.
40 Id. at p. 13.
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undermines Heisler’s contention.
Heisler failed to identify any evidence casting doubt on the validity of Girod’s proof
of claim, and there were no material factual issues to be resolved in ruling on Heisler’s
objection. Furthermore, as noted by Girod in its brief, “there were at least four hearings
on the Objections, as well as multiple opportunities to submit briefings on the issues.”41
The bankruptcy court did not abuse its considerable discretion when it declined to
conduct an evidentiary hearing prior to resolving the contested proof of claim.
The bankruptcy court did not err in determining Heisler’s objection failed to
rebut the statutory presumption of validity accorded to Girod’s proof of
claim.
In the opening brief and in the reply brief, Heisler does not contest the bankruptcy
court’s conclusion that Girod met its burden under Federal Rule of Bankruptcy Procedure
3001 to establish prima facie validity of its claim. The Court will briefly pass upon this
issue of the prima facie validity of Girod’s claim before turning to the issue of Heisler’s
objection to the claim.
Under Rule 3001, a “proof of claim executed and filed in accordance with [the
Federal Rules of Bankruptcy Procedure] shall constitute prima facie evidence of the
validity and amount of the claim.”42 Girod’s proof of claim meets all the requirements of
Federal Rule of Bankruptcy Procedure 3001. Girod’s proof of claim was timely filed on
October 21, 2020.43 The proof of claim is a written statement making a demand on the
Debtor’s estate, is filed on the Official Form 410, and is signed on behalf of Girod by David
Silverstein as authorized servicer for Girod. Girod’s proof of claim contains copies of the
seven promissory notes in issue and copies of the related loan documents, collateral
R. Doc. 17 at p. 23.
Fed. R. Bankr. P. 3001(f).
43 The deadline for filing claims in the chapter 7 case was December 30, 2020.
41
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agreements, and court orders and judgments memorializing the Debtor’s obligations to
Girod. Girod attached evidence showing that the claimed security interests have been
perfected.44 Indeed, Heisler’s objection admits that Heisler signed the promissory notes,
collateral agreements, and account control agreements included in Girod’s claim.45
In In re Northbelt, LLC, the United States Bankruptcy Court for the Southern
District of Texas aptly explained the burden of a party filing an objection to a proof of
claim as follows:
If an objection to the proof of claim is filed, the objecting party is tasked
with putting forth such evidence sufficient to rebut the presumption of
validity and establish that the claim should be disallowed. To successfully
rebut the presumption that such claim is allowable as filed, the objecting
party must produce evidence that is equal in probative force to that of the
proof of claim. As stated by one court in the Fifth Circuit, this means that
‘the objecting party [must] produc[e] specific and detailed allegations that
place the claim into dispute, by the presentation of legal arguments based
upon the contents of the claim and its supporting documents, or by the
presentation of pretrial pleadings, such as a motion for summary judgment,
in which evidence is presented to bring the validity of the claim into
question.’46
As mentioned above, Heisler did not present any evidence to rebut the
presumption of validity and establish the claim should be disallowed. Instead, Heisler’s
objection is founded entirely on the argument that Girod’s proof of claim is invalid due to
a lack or failure of consideration. As explained below, this argument is barred by the
doctrine of res judicata. As a result, Heisler has failed to rebut the presumption of validity
accorded to Girod’s proof of claim.
In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 135-2.
See In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 348, ¶¶ 11, 15.
46 In re Northbelt, LLC, 630 B.R. 228, 245 (Bankr. S.D. Tex. 2020) (quoting In re High Standard Mfg. Co.,
Inc., No. 15-33794, 2016 WL 5947244, at *3 (Bankr. S.D. Tex. Oct. 13, 2016)).
44
45
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The bankruptcy court did not err in determining the arguments presented by
Heisler in her objection to Girod’s proof of claim are barred by the doctrine
of res judicata.
At the outset, the Court observes that, in her Opening Brief, Heisler failed to make
any serious argument that res judicata does not apply. For the most part, Heisler failed to
address the factors applicable to the question of res judicata. Instead, Heisler appears to
argue the bankruptcy court’s conclusion on the res judicata question was erroneous
because there was no evidentiary hearing and no evidentiary record.
The most substantial legal argument Heisler makes in her Opening Brief on the res
judicata issue is as follows:
The order on appeal cites The Foreclosure Action, The Concursus Action
and The Dec Action by name only. In the infirm action at 24th JDC Docket
793-014, the case is still open with Heisler's Notice of lntent to Apply
for Writs in limbo because the district judge will not assign a date for
taking writs, raising unpleasant issues pursuant to Caperton v. A.T
Massey Coal. As to the Concursus and Dec Actions, both have
Declaratory Judgment and Right of Litigious Redemption issues
pending. Moreover, compliance with Louisiana CCP Article 1915(B) has
not happened. Calling the judgments "Final" doesn't make it so.47
Heisler’s reply brief is no better. In her reply brief, Heisler reurges the argument that “a
res judicata defense must be proven by a preponderance of the evidence at an evidentiary
hearing which the bankruptcy court never held.”48 The Court already has decided, above,
the bankruptcy court did not abuse its discretion in declining to hold an evidentiary
hearing. Further, the Court finds each of Heisler’s remaining arguments to lack merit.
The preclusive effect of a state court judgment in a subsequent federal lawsuit is
determined by the preclusion law of the state in which the judgment was rendered.49 At
R. Doc. 14 at p. 11 (emphasis in original).
R. Doc. 18 at p. 2.
49 See Marrese v. Am. Academy of Orthopaedic Surgeons, 470 U.S. 373, 380 (1985); see also Black v. N.
Panola Sch. Dist., 461 F.3d 584, 588 (5th Cir. 2006) (“To determine the preclusive effect of a state court
judgment in a federal action, federal courts must apply the law of the state from which the judgment
47
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issue in this case are (i) the writ of seizure and sale issued by the 24th Judicial District
Court for the Parish of Jefferson in favor of Girod in the executory process foreclosure
action; (ii) the final judgment issued by the Civil District Court for the Parish of Orleans,
in favor of Girod in the concursus action; and (iii) the final judgment issued by the Civil
District Court for the Parish of Orleans in favor of Girod in the declaratory judgment
action filed within the Succession of Frederick Heisler. All three of the judgments at issue
were rendered by Louisiana state courts. Louisiana’s preclusion law controls.
Louisiana Revised Statutes § 13:4231 provides as follows:
Except as otherwise provided by law, a valid and final judgment is
conclusive between the same parties, except on appeal or other direct
review, to the following extent:
(1) If the judgment is in favor of the plaintiff, all causes of action
existing at the time of final judgment arising out of the transaction
or occurrence that is the subject matter of the litigation are
extinguished and merged in the judgment.
(2) If the judgment is in favor of the defendant, all causes of action
existing at the time of final judgment arising out of the transaction
or occurrence that is the subject matter of the litigation are
extinguished and the judgment bars a subsequent action on those
causes of action.
(3) A judgment in favor of either the plaintiff or the defendant is
conclusive, in any subsequent action between them, with respect to
any issue actually litigated and determined if its determination was
essential to that judgment.50
The Louisiana Supreme Court has explained that, under § 13:4231, a second action is
precluded on grounds of res judicata when five elements are satisfied:
(1) the judgment is valid; (2) the judgment is final; (3) the parties are the
same; (4) the cause or causes of action asserted in the second suit existed at
the time of final judgment in the first litigation; and (5) the cause or causes
of action asserted in the second suit arose out of the transaction or
emerged.”).
50 La. Rev. Stat. § 13:4231.
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occurrence that was the subject matter of the first litigation.51
With respect to each of the three state court judgments, all five of these elements
are met. First, it is undisputed that each judgment is valid. The seizure and sale order in
the executory process foreclosure action was signed on June 21, 2019, by the Honorable
Scott U. Schlegel, District Judge for the 24th Judicial District Court of Louisiana, and
subsequently served on Heisler.52 The final judgment in the concursus action was entered
after Girod filed a motion for summary judgment, which Heisler opposed, and after a
hearing wherein the parties participated in oral argument. With respect to the declaratory
judgment action, Girod filed an exception of lis pendens based on the fact that the validity
of the promissory notes was already litigated in the executory process foreclosure action
and in the concursus action, and Heisler opposed Girod’s exception of lis pendens.53 In
addition, the court in the declaratory judgment action held a hearing and heard oral
argument on Girod’s exception of lis pendens. After the hearing, the court entered a
“Judgment” in the declaratory judgment action, granting Girod’s exception of lis pendens,
dismissing Heisler’s petition.54 The judgment was “read, rendered and signed at New
Orleans, Louisiana” on January 2, 20202.55 Accordingly, the judgment entered in the
declaratory judgment action is valid.
Second, each judgment is final. Louisiana Code of Civil Procedure article 1841
provides that “[a] judgment that determines the merits in whole or in part is a final
judgment.”56 In the executory process foreclosure action, the seizure and sale order is
Chevron U.S.A., Inc. v. State, 993 So. 2d 187, 194 (La. 2008) (quotations omitted).
See In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 385-2.
53 See id. at R. Doc. 385-6.
54 Id.
55 Id.
56 La. C. Civ. P. art. 1841.
51
52
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signed by the Court is a final judgment.57 Under Louisiana law, there are only two avenues
for objecting to an executory process proceeding: (1) by filing an injunction to arrest the
seizure and sale, or (2) by filing a suspensive appeal from the order of seizure and sale.58
Plaintiff has failed to avail herself of either of these two avenues. Moreover, Plaintiff
sought supervisory writs from the Louisiana Supreme Court with respect to the
foreclosure action, and the Louisiana Supreme Court denied the writs. Plaintiff also filed
a Petition for Certiorari in the United States Supreme Court, which also was denied. The
24th JDC’s seizure and sale order is now final. In the concursus action, the CDC granted
LoanCo’s motion for summary judgment and signed a “Final Judgment.”59 This was a
judgment on the merits in favor of Girod, finding that Girod had the better claim to the
Schwab funds, thereby resolving the concursus action in full.60 In fact, the “Final
Judgment” entered in the concursus action expressly states that “this judgment be and
the same is hereby identified as a final judgment which adjudicates all outstanding issues
in this concursus proceeding.”61 Turning to the declaratory judgment action, a judgment
granting an exception of lis pendens is a final appealable judgment, and Heisler did not
appeal the judgment.62 Accordingly, the judgment entered in the declaratory judgment
57 See Countrywide Home Loans Servicing, LP v. Thomas, 2012-1304 (La. App. 4 Cir. 3/20/13), 113 So. 3d
355, 358, writ denied, 2013-0894 (La. 5/31/13), 118 So. 3d 397 (finding that “Louisiana courts have treated
orders of seizure and sale as judgments for res judicata purposes,” and collecting cases); see also Jackson
v. Bank of Am., N.A., No. CIV.A. 13-5795, 2013 WL 6185037, at *2 (E.D. La. Nov. 26, 2013) (concluding
that seizure and sale order obtained via verified petition in executory process foreclosure action was a final
judgment for purposes of res judicata).
58 La. C. Civ. P. art. 2642. See also Antoine v. Chrysler Fin. Corp., 782 So.2d 651, 652 (La. Ct. App.2001).
59 See In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 385-3.
60 See id.
61 See id.
62 Nat'l Glass & Glazing, Inc. v. Grimaldi Const., Inc., 96-121 (La. App. 5 Cir. 7/30/96), 680 So. 2d 56, 63,
writ denied, 96-2757 (La. 1/10/97), 685 So. 2d 146 (“The grant of the exception of lis pendens filed by
National dismissing Grimaldi's reconventional demand for damages as a result of glass used in the NOMA
project is a final appealable judgment which was not timely appealed and is therefore final.”); Norris v.
Norris, 539 So. 2d 1241, 1242 (La. Ct. App. 1988) (“The maintenance of an exception of lis pendens . . . is a
final appealable judgment.”).
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action is now final.
Third, the parties in all of the state court actions are the same parties to this
contested matter in the bankruptcy: Regina Heisler and Girod LoanCo, LLC.
Fourth, the no consideration defense63 Heisler asserts now in her objection to
Girod’s proof of claim was available to her during the pendency of each of the three state
court lawsuits. Each of the three state court suits concerned Girod’s enforcement of its
rights under the promissory notes and collateral agreements, and Heisler’s various and
sundry attempts to thwart Girod’s efforts, and each state court suit was necessarily filed
after Heisler executed the notes. Accordingly, Heisler’s no consideration defense was
available to her at the time the state court suits were being litigated. In fact, Plaintiff
specifically made the no consideration argument in each of the three state court suits.64
Finally, Girod’s proof of claim and Heisler’s objection arise out of the same
transaction or occurrence that was the subject of the state court suits. Each state court
suit dealt with Girod’s right to payment under the promissory notes, and Girod’s attempt
to enforce its rights in the collateral securing Heisler’s obligations under those notes.
Similarly, Girod’s proof of claim is based upon the promissory notes and related collateral
agreements executed by Heisler prior to the filing of her bankruptcy petition,65 and
63 “The federal doctrine of res judicata bars relitigating any part of the cause of action in question, including
all claims and defenses that were actually raised or could have been raised.” Aerojet-Gen. Corp. v. Askew,
511 F.2d 710, 715 (5th Cir. 1975). The same rule applies with respect to Louisiana’s doctrine of res judicata.
As explained by the Louisiana Second Circuit Court of Appeal,
[t]he theory of civilian res judicata is that matters actually litigated and finally adjudged
are presumed correct and thus should not be contradicted in a subsequent suit. . . . It is
well-settled that the term ‘cause of action,’ as used in LSA–R.S. 13:4231, is a mistranslation
from the French and really refers to the civil concept of cause. . . . ‘Cause’ is said to be the
juridical or material fact which is the basis of the right claimed, or the defense pleaded. It
can be likened to ‘grounds,’ ‘theory of recovery,’ or the principle upon which a specific
demand is grounded.
Greer v. State, 616 So. 2d 811, 815 (La. Ct. App. 1993).
64 See In re Regina Berglass Heisler, No. 20-11509 at R. Doc. 385-2 at p. 11; id. at R. Doc. 385-4; id. at R.
Doc. 385-5; id. at R. Doc. 385-8.
65 See Girod’s proof of claim and addendum, R. Doc. 17-1 at pp. 17–35.
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Heisler’s objection to Girod’s proof of claim is premised on the contention that Heisler
did not receive any consideration in exchange for the promissory notes which Girod seeks
to enforce. The fifth factor is met.
The bankruptcy court did not err in ruling that the arguments presented in
Heisler’s claim objection are barred by the doctrine of res judicata. Accordingly, the Court
finds that the bankruptcy court correctly held that Heisler’s objection should be
overruled, and Girod’s proof of claim allowed to proceed, in its entirety, forthwith.66
CONCLUSION
IT IS ORDERED that the bankruptcy court’s August 13, 2021 Memorandum
Opinion and Order is AFFIRMED IN ALL RESPECTS.
IT IS FURTHER ORDERED that Appellant Regina Heisler’s appeal is
HEREBY DISMISSED WITH PREJUDICE.
New Orleans, Louisiana, this 29th day of March, 2022.
______________________ _________
SUSIE MORGAN
UNITED STATES DISTRICT JUDGE
66 Because the Court finds that Heisler’s no consideration argument is barred by the doctrine of res judicata,
the Court does not address Girod’s alternative argument, namely, that Heisler’s no consideration argument
is barred by the Rooker-Feldman doctrine.
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