Listecki v. Official Committee of Unsecured Creditors

Filing 46

ORDER signed by Judge Rudolph T. Randa on 10/1/2013 DENYING 27 MOTION to Vacate Judgment and Decision and Order Pursuant to Federal Rule of Civil Procedure 60(B) and 28 U.S.C. § 455; DENYING 30 MOTION for Recusal of the Honorable Rudolph T. Randa from the Cemetery Trust Litigation and Cemetery Related Proceedings. (cc: all counsel)(cb)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
In re Archdiocese of Milwaukee,
Debtor.

Bankruptcy Case No. 11-20059-SVK

ARCHBISHOP JEROME E. LISTECKI,
as Trustee of the Archdiocese of Milwaukee
Catholic Cemetery Perpetual Care Trust,
Appellant,
-vs-

Adv. Proc. No. 11-2459-SVK
Case No. 13-C-179

OFFICIAL COMMITTEE OF UNSECURED
CREDITORS,
Appellee.

DECISION AND ORDER

On July 29, 2013, the Court held that more than $50 million dollars being held
in the Archdiocesan Cemetery Trust could not be brought into the underlying
bankruptcy estate because the Committee of Unsecured Creditors, “in pursuing the
claims of the unsecured creditors under the authority granted to it by the bankruptcy
court, acts „under color of law‟ and is subject to [the Religious Freedom Restoration
Act].

Therefore, RFRA and the First Amendment prevent the Committee from

appropriating the funds in the Trust because doing so would substantially burden the
Trustee‟s free exercise of religion.” ECF No. 24, at 2; --- B.R. ---, 2013 WL 3937021,
at *1 (E.D. Wis. July 29, 2013).

In response, the Committee launched an investigation into my background in
relation to the Milwaukee Catholic Cemeteries. First, the Committee learned (by
searching publicly-available databases) that many of my relatives are buried in
Archdiocesan cemeteries. Then, the Committee moved for an order directing the
Archdiocese to search its business records to determine if I or my wife have any
agreements for burial spaces at Archdiocesan cemeteries.

The bankruptcy court

granted this motion. As a result, the Committee learned that 38 years ago on August 1,
1975, I purchased a burial crypt for my parents in the Holy Cross Mausoleum.1 Armed
with this information, the Committee moves for recusal and to vacate the Court‟s
judgment.
The Court is at a loss trying to understand why these motions were brought.
The Committee is entitled to de novo review in the Seventh Circuit Court of Appeals.
Instead of proceeding directly to the Seventh Circuit, the Committee decided to inject
collateral issues into these proceedings for the stated purpose of vacating a prior ruling
and sending the case to another district judge. This is a wasteful use of time, money,
and judicial resources. The Seventh Circuit, if not the Supreme Court, will be the final
word on the issues raised by the Cemetery Trust litigation. The last thing this case
needs is another decision by another lower court federal judge before it reaches the
1

The Holy Cross Mausoleum is located at 7301 West Nash Street.
http://www.cemeteries.org/pdf/HolyCrossChapelMausoleum_July2004.pdf. The following article
includes a picture of my parents‟ crypt. Bruce Vielmetti and Karen Herzog, Records show judge in
Milwaukee Archdiocese case has cemetery ties, Milwaukee Journal Sentinel, Aug. 14, 2013.
http://www.jsonline.com/features/religion/milwaukee-archdioceses-creditors-want-ruling-haltedjudge-off-case-b9975543z1-219553341.html.

-2-

Seventh Circuit.
Questionable motives aside, the Court takes up the motion. The Committee
argues that I have a “financial interest in the subject matter in controversy” by virtue of
purchasing2 my parents‟ crypt. 28 U.S.C. § 455(b)(4). The statute defines “financial
interest” as “ownership of a legal or equitable interest, however small . . .” § 455(d)(4).
The term “interest,” as used in § 455(b)(4), means “an investment or other asset whose
value depends on the outcome, or some other concrete financial effect.” Guardian
Pipeline, LLC v. 950.80 Acres of Land, 525 F.3d 554, 557 (7th Cir. 2008).

My

parents‟ burial crypt is not an investment or asset, much less an asset whose value
depends upon the outcome of this litigation. This was a consumer purchase of my
parents‟ rights of entombment from the Archdiocese of Milwaukee.

Holy Cross

Mausoleum Purchase Agreement, ECF No. 32, Ex. N (“SELLER hereby offers for sale
the right of entombment only in said Mausoleum in the crypt space(s) hereinafter
described. PURCHASER hereby agrees to purchase said right of entombment . . .”)
(emphasis added).
The Committee argues that I have a financial interest in this case because the
burden for providing perpetual care could fall to me.

The Purchase Agreement

specifically precludes this type of arrangement. Id. at ¶ 15 (“All services about the
crypt or Mausoleum requiring labor shall be performed only by the SELLER”); ¶ 19
(“The SELLER shall provide care and maintenance and such care and maintenance
2

The crypt cost $3,800. Holy Cross Mausoleum Agreement, ECF No. 32, Exhibit N.

-3-

shall be performed only by the SELLER”).

In any event, by analogy to cases

involving judges as utility consumers, a possible adverse effect on the Trustee‟s ability
to maintain my parents‟ crypt is not a financial interest within the meaning of §
455(b)(4). In re N.M. Natural Gas Antitrust Litig., 620 F.2d 794, 796 (10th Cir. 1980)
(“a remote, contingent benefit, such as a possible beneficial effect on future utility
bills, is not a „financial interest‟ within the meaning of the statute”); In re Va. Elec. &
Power Co., 539 F.2d 357, 366 (4th Cir. 1976) (“We think it demonstrable that [the
district judge] did not „own‟ a legal or equitable interest in the subject matter of the
controversy. The only interest the judge has in the subject matter is the remote
contingent possibility that he may in futuro share in any refund that might be ordered
for all VEPCO customers”).
The Committee also argues that I have a financial interest pursuant to the proof
of claim filed on behalf of Cemetery Care Claimants in the underlying bankruptcy
proceeding. ECF No. 44, Claim 179-1. This is incorrect. The rider to the claim
explains that it “does not constitute a request for payment on behalf of any individual
or entity,” nor does it “constitute an assertion by the Debtor as to whether or not any
individual Cemetery Care Claimants are „creditors‟3 . . . with respect to the obligations
of the Debtor to provide perpetual care.” Id., Rider to Proof of Claim Filed on Behalf
3

Even if I could be considered a creditor to the bankruptcy estate, this does not make me a
“party to the proceeding” for purposes of recusal. Committee on Codes of Conduct Advisory
Opinion No. 100 (June 2009) (Identifying Parties in Bankruptcy Cases for Purposes of
Disqualification) (“simply being a creditor or interest holder of the bankruptcy estate is not a
sufficient interest to make that creditor „a party to the proceeding‟”).

-4-

of the Cemetery Care Claimants, ¶¶ 8-9 (emphasis added). Thus, the Committee‟s
citation to Tramonte v. Chrysler Corp., 136 F.3d 1025 (5th Cir. 1998) is inapposite.
“[W]here a judge or an immediate family member is a member of a class seeking
monetary relief, § 455(b)(4) requires recusal because of the judge‟s financial interest in
the case.” Id. at 1029 (emphasis added).
Because there is no financial interest, any interest requiring recusal falls under
the second clause of § 455(b)(4), whereby I must recuse myself if I have “any other
interest that could be substantially affected by the outcome of the proceeding.” My
parents have been entombed for almost forty years; that will not change as a result of
this lawsuit. To the extent that I have an interest in the care and maintenance of my
parents‟ crypt, the Milwaukee Catholic Cemeteries “encompass approximately 1,000
acres of land in which more than 500,000 individuals are interred.” ECF No. 24, at 3;
2013 WL 3937021, at *1. In total, there are eight cemeteries and seven mausoleums.4
Accordingly, if the Trustee‟s ability to provide perpetual care is diminished, there is no
guarantee that the Holy Cross Mausoleum in general, or my parents‟ crypt in
particular, would be impacted in any way, shape or form. Moreover, the Trustee‟s
moral and canonical obligation to provide perpetual care will not disappear if he loses
this lawsuit. His duty to provide perpetual care continues. In the unlikely event that
the Trustee completely fails to satisfy this duty, local municipalities can (and in some
instances must) intervene. Wis. Stat. § 157.115(1)(b)1.-2; see, In re N.M. Natural Gas
4

http://www.cemeteries.org/aboutus0013.asp.

-5-

Antitrust Litig. at 796 (“independent intervention by the Commission cancelling any
benefit is possible”).

Therefore, my interest in the care and maintenance of my

parents‟ burial crypt will not be substantially affected by the outcome of this lawsuit.
In re Va. Elec. & Power Co. at 368 (“Thus a judge who is a customer of a company
must necessarily consider the remoteness of the interest and its extent or degree. . . .
[The judge‟s] interest here is remote and speculative. . . . whether he ever gets any
refund benefit will not be determined by him nor by the result of this litigation”).
Lastly, the Committee argues for recusal under § 455(a), a “catch-all” which
provides that a judge “shall disqualify himself in any proceeding in which his
impartiality might reasonably be questioned.”

The inquiry under this section is

objective, asking judges to analyze “whether a reasonable person perceives a
significant risk that the judge will resolve the case on a basis other than the merits.” In
re Mason, 916 F.2d 384, 385 (7th Cir. 1990) (citing Liljeberg v. Health Servs.
Acquisition Corp., 486 U.S. 847, 865 (1988)). An objective standard is “essential
when the question is how things appear to the well-informed, thoughtful observer
rather than to a hypersensitive or unduly suspicious person. Because some people see
goblins behind every tree, a subjective approach would approximate automatic
disqualification.” Id. at 386.
As discussed above, any interest that I may have in the maintenance of the
Milwaukee Catholic Cemeteries is extremely remote. “Judges regularly sit in cases
that could affect their well-being tangentially. A judge who owns a house could be
-6-

affected by a decision influencing the rate of interest, a judge who owns stock in the
coal industry could be affected by a decision in a case concerning nuclear power, and
so on. These indirect effects do not cause informed, reasonable observers to doubt a
judge’s disinterest.” In re Matter of Nat’l Union Fire Ins. Co., 839 F.2d 1226, 1229
(7th Cir. 1988) (emphasis added).
Going further, the Committee argues that I have a personal, emotional interest
in the outcome of this case — yet at the same time, the Committee insists that it is not
moving for recusal because I am Catholic. The Committee cannot take the latter
position because of the general recognition that a judge‟s religious affiliation is not
grounds for disqualification. See, e.g., Feminist Women’s Health Ctr. v. Codispoti, 69
F.3d 399 (9th Cir. 1995) (denying motion to recuse Catholic judge in action brought by
abortion clinic against abortion protestors); United States v. El-Gabrowny, 844 F.
Supp. 955 (S.D.N.Y. 1994) (denying motion to recuse Jewish judge in prosecution for
World Trade Center bombing); Singer v. Wadman, 745 F.2d 606, 608 (10th Cir. 1984)
(denying motion to recuse Mormon judge in case that involved the “theocratic power
structure of Utah”). But, as to the former position, the Committee ascribes these
personal and emotional interests to me because I am Catholic, describing my interest in
the outcome of this case as religious and moral. The Court fails to see the distinction
between moving for recusal because I am Catholic and moving for recusal because of
my religious interests. There is none.
Whichever way my interest is characterized, a reasonable person would not
-7-

perceive a substantial risk of bias in this case. Given that my wife and I have both
lived here for almost our entire lives, it should not have been surprising for anyone to
learn that I have relatives who are interred in the Milwaukee Catholic Cemeteries.
Most judges are old enough to have close relatives buried somewhere. Aging and
death are facts of life, not just for judges. Over 500,000 individuals are interred in the
Milwaukee Catholic Cemeteries, so my relation to some of those individuals is a
characteristic that I share with countless members of this community. The logical
conclusion of the Committee‟s argument is that none of these people could render an
impartial decision this case. This is untenable, and it is objectively unreasonable. On
top of that, the Committee‟s motion presumes that I would be personally upset or
aggrieved by the remote possibility that a family member‟s gravesite might somehow
fall into disrepair, so much so that I would ignore my duty to exercise impartial
judgment.

Again, a well-informed, thoughtful observer would not make this

presumption. See, e.g., Perry v. Schwarzenegger, 790 F. Supp. 2d 1119, 1130 (N.D.
Cal. 2011) (Regarding Judge Walker, who ruled against California‟s ban on same-sex
marriage, a “well-informed, thoughtful observer would recognize that the mere fact
that a judge is in a relationship” with someone of the same sex “does not ipso facto
imply that the judge must be so interested in marrying that person that he would be
unable to exhibit the impartiality which, it is presumed, all federal judges maintain”).
For all of the foregoing reasons, recusal is unnecessary. Laird v. Tatum, 409
U.S. 824, 837 (1972) (Rehnquist, J., in chambers) (“a federal judge has a duty to sit
-8-

where not disqualified which is equally as strong as the duty to not sit where
disqualified”). The Committee‟s motions to vacate [ECF No. 27] and for recusal [ECF
No. 30] are DENIED.
Dated at Milwaukee, Wisconsin, this 1st day of October, 2013.

BY THE COURT:

__________________________
HON. RUDOLPH T. RANDA
U.S. District Judge

-9-