Chien v. Commonwealth Biotechnologies, Inc.
Filing
31
MEMORANDUM OPINION. Signed by District Judge Robert E. Payne on 06/26/13. (kyou, ) (copy mailed to Pro Se party at Riverside Regional Jail)
L
Ml.. •
IN THE UNITED
STATES
DISTRICT
•••
.
• -•
li
COURT
JUN 2 6 2013
Richmond Division
RICHMOND. VA
ANDREW CHIEN,
Appellant,
Civil Action No.
3:12cv900
COMMONWEALTH
BIOTECHNOLOGIES,
INC.,
Appellee.
MEMORANDUM OPINION
This matter is before the Court on appellant Andrew Chien's
PChien")
FOR
MOTION TO GRANT ANDREW CHIEN AS THE SUBSTITUTION PARTY
FORNOVA AS
DEFENDANT
IN
reasons set forth herein,
THIS
CASE
(Docket
No.
12).
For
the
the motion will be denied.
BACKGROUND
This
Fornova
appeal
arises
Pharmworld
Bankruptcy
Court
from entry of
Inc.
{"Fornova")
for
the
Eastern
January
20,
2011,
Biotechnologies,
Inc.
default
by
judgment against
the
District
of
United
States
Virginia
("the
Bankruptcy Court").
On
Chapter
11 of
the
May
2011,
Fornova
16,
10, 2012,
claim
and
("CBI")
the
filed a petition
Bankruptcy Code
filed
debtor-appellee,
a
in
claim
the
for
Commonwealth
for relief under
Bankruptcy Court.
$622,167.
On
On
February
CBI initiated an Adversary Proceeding objecting to the
seeking
either
to
either
equitably
-•••
^
i
FOR THE EASTERN DISTRICT OF VIRGINIA
v.
»••
subordinate
the
"
claim
or
recharacterize
March
12,
the
claim
2012,
Chien
filed
on
behalf
of
Proceeding"
Fornova's
"trustee."
On
a
as
"Motion
Fornova,
March
an
20,
equity
to
interest.
Dismiss
describing
2012,
pretrial conference on behalf of Fornova.
Chien
On
Adversary
himself
appeared
as
at
At this meeting,
a
Chien
was advised by the Bankruptcy Court that he could not appear on
behalf
of
Fornova
without
attorney.
Thereafter,
represent
Fornova
of theories,
Order
on
or
Undeterred,
Chien
before
a
engaged
the
licensed
in
a
and
duly
series
Bankruptcy Court,
of
admitted
efforts
under
a variety
1,
2012
requiring
attempting
to
however,
on
Chien
appear
June
13,
to
refrain
on
behalf
2012,
from
of
Chien
filing
Fornova.
filed
additional motions before the Bankruptcy Court.
Accordingly,
June
order
14,
to
which culminated in the Bankruptcy Court entered an
May
documents
being
2012,
the
Bankruptcy Court
issued
an
two
on
directing
Chien to appear before the Bankruptcy Court and show cause why
he should not be held in contempt.
On
July
hearing
18,
and,
2012,
after
the
Bankruptcy Court
hearing
Chien's
held
various
a
show cause
arguments,
the
Bankruptcy Court held Chien in contempt.1 As a result of its
conclusion that
Chien could not
represent
Fornova,
and finding
1 That order was appealed to this Court and was affirmed by
Memorandum
Opinion
dated
December
19,
2012.
Chien
Commonwealth
Biotechnologies,
Inc.,
No.
3:12-cv-707-REP,
B.R.
659
(E.D.
Va.
2012) .
v.
484
that Fornova had failed to
Proceeding,
the
respond as
Bankruptcy
Court
required to
entered
against Fornova and in favor of CBI.
the Adversary
default
On December 20,
judgment
2012,
Chien
timely filed a notice of appeal of the Bankruptcy Court's order.
On January 8, 2013,
Bankruptcy Court's
Memorandum
Court
Order
denied
directed
the
Chien
to
Chien filed a motion for a stay of the
order pending the
dated
February
motion.
file
In
a
5,
that
appeal
2013
(Docket
Order,
supplemental
(Docket No.
the
brief
No.
Court
4).
11),
sua
addressing
By
the
sponte
how
he
had standing to appeal the Bankruptcy Court's order on behalf of
Fornova.
On February 7, 2013,
Chien filed the present motion seeking
to substitute himself for Fornova as a party to this action.
On
February
to
20,
2013,
the
Court
reconsider its February 5 Order,
granted
Chien's
motion
insofar as Chien had set forth
his theory of standing in his motion to substitute parties.
Order dated February 20,
substitute
parties,
2013
Chien
(Docket No.
asserts,
in
16).
In the motion to
essence,
purchased the note at issue from Fornova and that,
now has
CBI
standing to pursue the claim against CBI.
filed a
limited objection
(Docket No.
17)
See
that
he
has
therefore,
he
In response,
taking the
view
that it has no objection to Chien being substituted for Fornova
if he had purchased the note,
but expressing the view that Chien
had not, in fact, purchased the note.2 In a supplemental response
(Docket No.
authority
21) , CBI
a
motion
similar
only,
by
(Docket No.
commended to
decision
Chien
by
in
the Court,
the
that
for its persuasive
Bankruptcy
court.
Court
Chien
denying
filed
18) and a supplemental reply (Docket No.
a
a
reply
25).
DISCUSSION
Chien's motion to substitute himself as the proper party in
interest is predicated on the claim that he has validly become a
holder
of
the
Fornova
note.
If
he
has,
then,
as
CBI
concedes,
Chien likely ought to be substituted as the party in this action
and Chien would,
appeal.
Debtor
See
at
that point,
have
Appellee's
not
does
Objection
to
object
the
standing to
(Docket
No.
substitution
prosecute the
17)
of
at
Mr.
8
("The
Chien
for
Fornova if ... he has properly purchase the purported note and
is indeed the legal holder of the Claim.").
determine whether Chien is a
holder of the
Thus,
the Court must
Fornova
note.
According to the terms of the Purchase Agreement,
by Chien as
aspects
State
evidence of
of
of
[the]
his purchase of
Agreement
Connecticut."
should
be
the
Fornova note,
governed
Purchase Agreement
submitted
by
(Docket
the
No.
"all
Laws
of
13-9)
at
2 As CBI notes, if the motion to substitute were granted, Chien
would
"step
occurred."
1998) .
into
In
What
afford Chien
re
his
predecessor's
Wills,
relief,
if
226
any,
B.R.
a
shoes
369,
as
375
substitution
is not before the Court
if
no
(Bankr.
of
change
E.D.
parties
in this motion.
has
Va.
would
2.
Under
Connecticut
instrument,
such
governed
Connecticut's
Conn.
by
Gen.
as
law,
Stat.
the
§
the
transfer
promissory
Uniform
42a-3-203.
person
other
who,
is
the
through
instrument."
A.3d 1077,
than
Ulster
1085
App.
transferred when it
issuer
for
delivery
the
the
to
quotations
omitted).
note,
thus
holder
Cadle
and
must
Co.
is
the
the
Errato,
Estate
1998)
Ltd
("The
v.
it
Code,
here,
is
codified
provides
instrument
28
2012).
to
the
the
to
at
that
Brynwood Lane,
Further,
another
holder
of
the
Ltd.,
41
"[a]n instrument
to
A.2d
the
establish
enforce
physical
802
to
person
instrument."
the
887,
895
note,
of
(Conn.
production of
716
A. 2d
(internal
the
the
App.
of
the
purported
note.
Ct.
See
2002)
the plaintiff was required
possessed the note.");
Gallicchio,
Id.
receiving
possession
possession
("[T]o establish a prima facie case,
to demonstrate that
issue
law
becomes
giving
order
right
demonstrate
v.
of
enforce
In
negotiable
delivered by a person other than its
purpose
right
of
Bank v.
Ct.
a
a transfer of possession by
negotiation,
(Conn.
at
Connecticut
issuer
Savings
note
Commercial
"negotiation of an instrument means
someone
of
903,
see also SKW Real
908
the note establishes
(Conn.
App.
his prima
Ct.
facie
case against the makers and he may rest there.") . A copy of the
note may serve to establish possession,
party
"fail[s]
to
[purported holder]
present
any
evidence
but only where the other
demonstrating
was not in possession of
that
the
the note or casting
any doubt
on the
[purported holder's]
course." Cadle Co. , 802 A.2d at
the
original
note,"
"sufficient evidence
the
status as
8 96. However,
purported
a holder in due
in "the absence of
holder
must
present
. . . to support a finding" of possession.
Id.
CBI clearly challenges Chien's claim to
Debtor's Supp. Obj.
hold the note.
(Docket No. 21) at 2. Chien does not dispute
that he does not have possession of the note.
to
Supp.
Andrew
Obj.
(Docket
No.
signed
Chien
the
Wang . . . However,
Chien
Lizi
nevertheless
25)
at
1
("On
purchasing
Wang
argues
can't
that
See Chien's Resp.
December
deliver
the
the
and
Connecticut
signed
law
is
by
the
clear:
in
parties.
order
2012,
Lizi
original.").
"purchasing
Id.
for
22,
with
agreement
enforceable" because the agreement is "original,
written"
See
at
the
order
real,
2.
is
and well
Nevertheless,
Fornova
Note
to
be
effectively negotiated and for Chien to become the legal holder
of
the
note,
the
note
must
be
delivered
to
Chien
and
he
must
that
Chien
is
not
the
have
the
take possession of it.
Accordingly,
holder
of
the
the
Fornova
right to enforce it.
Court
Note
concludes
and,
as
a
result,
does
not
CONCLUSION
For the reasons set forth above,
ANDREW CHIEN AS
IN THIS CASE
It
is
THE
SUBSTITUTION
(Docket No.
12)
PARTY
Chien's MOTION TO GRANT
FOR FORNOVA AS
DEFENDANT
will be denied.
so ORDERED.
/a/
fcliP
Robert E. Payne
Senior United States District Judge
Richmond, Virginia
Date: June %>L.t 2013
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