Barkany Asset Recovery and Management LLC v. Marina District Development Co, LLC

Filing 20

ORDER granting 17 application to file Motion to Intervene. Ordered by Magistrate Judge James Orenstein on 8/3/2015. For the reasons set forth in the attached document, I grant the Trustee's request to file a motion to intervene, supported by a proposed pleading, pursuant to Federal Rule of Civil Procedure 24. I direct the Trustee and the parties to confer and, if they remain in dispute on the request to intervene, submit a jointly proposed briefing schedule by August 10, 2015.(Orenstein, James)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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BARKANY ASSET RECOVERY
AND MANAGEMENT LLC,
Plaintiff,
- against MARINA DISTRICT
DEVELOPMENT CO, LLC,
Defendant.
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MEMORANDUM
AND ORDER
14-CV-2602 (RJD) (JO

JAMES ORENSTEIN, Magistrate Judge:
This case has been automatically stayed as a result of the filing of an involuntary bankruptcy
petition against the plaintiff. See Order dated July 16, 2014; 11 U.S.C. § 362. The Trustee appointed in
that bankruptcy proceeding now seeks leave to file a motion to intervene in this action so that he may
remove it to the bankruptcy court. Docket Entry ("DE") 17. The plaintiff consents to the proposed
intervention and the defendant opposes it. See DE 18; DE 19. As briefly explained below, I grant the
request.
The defendant opposes the request for two reasons. First, it contends that as a result of the
automatic stay, "'proceedings against the debtor are void ab initio.'" DE 19 at 1 (quoting Maritime Elec.
Co. v. United Jersey Bank, 959 F.2d 1194, 1207 (3d Cir. 1992)). The observation is a non-sequitur as
neither the instant case nor the Trustee's motion involves a proceeding against a debtor; to the
contrary, the proceeding is against the plaintiff's creditor. Moreover, a ruling that the Trustee must
wait for the stay to expire before seeking to remove the case to the bankruptcy court would effectively
deprive the Trustee of the right to seek such relief at all.
Second, the defendant contends that the proposed intervention would be futile because the
Trustee cannot state a claim for relief. While "futility is a proper basis for denying a motion to
intervene[,]"Plumbers' & Pipefitters' Local No. 562 Supp. Plan & Trust v. J.P. Morgan Acceptance Corp. I, 2011
WL 6182090, at *1 (E.D.N.Y. Dec. 13, 2011) (quoting In re Merrill Lynch & Co., Inc. Research Reports Secs.

Litig., 2008 WL 2594819, *5 (S.D.N.Y. Jun. 26, 2008)), the argument is premature in the absence of the
Trustee's proposed pleading.
For the reasons set forth above, I grant the Trustee's request to file a motion to intervene,
supported by a proposed pleading, pursuant to Federal Rule of Civil Procedure 24. I direct the Trustee
and the parties to confer and, if they remain in dispute on the request to intervene, submit a jointly
proposed briefing schedule by August 10, 2015.
SO ORDERED.
Dated: Brooklyn, New York
August 3, 2015

_
/s/
JAMES ORENSTEIN
U.S. Magistrate Judge

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