Ries v. Bjorge

Filing 3

ORDER Remanding the case to the Bankruptcy Court until the Proceeding is Trial Ready (Written Opinion). Signed by Judge Ann D. Montgomery on 07/13/2012. (TLU)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MINNESOTA

Charles W. Ries, Chapter 7 Trustee,
Plaintiff,
v.

ORDER
Civil No. 12-1616 ADM

Thomas Bjorge,
Defendant.
__________________________________________________________________
This adversary proceeding was initiated in Bankruptcy Court by a bankruptcy
trustee asserting a fraudulent transfer claim under 11 U.S.C. § 548. Docket No. 1,
Attach. 1 (Compl.). The defendant demands a jury trial and does not consent to trial of
the matter by the Bankruptcy Court. Thus, the Bankruptcy Court ordered that the
adversary proceeding be transferred to the District Court pursuant to Local Rule 50113(a).1 Docket No. 1, Attach. 17 (Transfer Order).
The transfer of to the District Court is premature at this early stage in the adversary
proceeding. The interests of judicial economy are best served by returning the proceeding
to the Bankruptcy Court to utilize that court’s expertise until the proceeding is trial ready.
See In re Healthcentral.com, 504 F.3d 775, 787-88 (9th Cir. 2007) (finding a defendant’s

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Local Rule 5011-3(a) states in relevant part:
On the [bankruptcy] judge’s own initiative or on motion of a party
in interest, the bankruptcy judge shall transfer to the district court:
1) any proceeding in which the court has determined that there is a
right to trial by jury of the issues for which a jury has been timely
demanded, and the parties have not consented to the bankruptcy
judge conducting the jury trial.

Seventh Amendment right to a jury trial in district court does not require immediate
transfer of the proceeding to the district court, and the bankruptcy court’s retention of the
proceeding until it is trial ready promotes judicial economy by utilizing the bankruptcy
court’s specialized knowledge of Title 11 actions); In re Enron Corp., 318 B.R. 273, 27576 (S.D.N.Y. 2004) (denying withdrawal at the “early stage” of an adversary proceeding
because the bankruptcy court’s retention of the proceeding “until the case is trial-ready
would further the interests of judicial economy”); In re Petters Co., 440 B.R. 805, 810
(Bankr. D. Minn. 2010) (stating the bankruptcy court’s retention of the proceeding for
pre-trial matters “make[s] best use of the specialized expertise of the bankruptcy
judiciary”).
Accordingly, the case is remanded to the Bankruptcy Court until the proceeding is
trial ready.
BY THE COURT:

s/Ann D. Montgomery
ANN D. MONTGOMERY
U.S. DISTRICT JUDGE
Dated: July 13, 2012.

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