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Copyright 2013

ADVERSARY PROCEEDINGS:

NUTS AND BOLTS ‐ PRE‐SUIT AND POST‐SUIT CONSIDERATIONS

Consumer bankruptcy practitioners will come across adversary proceedings in a range of contexts, but most probably in connection with discharge or dischargeability objections. Such actions will form the backdrop for this paper.

I. Is an adversary proceeding necessary?

Both the Federal Bankruptcy Rules and case law govern whether a formal adversary proceeding is required to adjudicate your issue. Rule 7001 lists certain matters that must be brought within an adversary proceeding rather than as a contested matter governed by Rule 9014. See, e.g., Rule 7001(4) (proceedings to object to or revoke a discharge, with some enumerated exceptions (including those objections for repeat filers under section 1328(f)), are adversary proceedings), and 7001(6) (a proceeding to determine the dischargeability of a debt is an adversary proceeding). Case law has established other examples of adversary proceedings. See, e.g., In re Kinion, 207 F.3d 751 (5th Cir. 2000) (contesting liens requires adversary proceedings); In re Zale Corp., 62 F.3d 746 (5th Cir. 1995) (injunctions require adversary proceedings). In certain instances, on a case‐by‐case basis, factors may support a determination by the bankruptcy court that compliance with Rule 7001 has been waived. See, e.g., In re Zale Corp., 62 F.3d at 763.

II. How do you commence an adversary proceeding?

Literally, the filing of a complaint commences an adversary proceeding. Rule 7003. More practically, courts generally require the filing of an adversary proceeding cover sheet. See Official Form B 104. The cover sheet allows the court clerk to immediately know the parties and counsel, the nature of the causes of action, amount demanded, relief requested, whether state law issues exist, whether it is a class action, and whether a jury demand is involved. In


addition to providing statistical analysis, this information allows the Court to more‐readily determine whether there will be jurisdictional issues to address early on.

III. What do you do after filing suit?

Rule 7004 governs process and service of the complaint. The complaint must be served upon the defendant in accordance with the Rules and with a copy of the summons. In the bankruptcy court for the Northern District of Texas (“NBTX”), the court clerk automatically issues a summons based upon the information provided in the adversary proceeding cover sheet and complaint. In the bankruptcy court for the Eastern District of Texas (“EBTX”), plaintiff will prepare a summons and submit it for issuance by the court clerk. See, e.g., attached Official Form B 250A. The summons must be served within 14 days of issuance, or it must be reissued. Rule 7004(e). In the NBTX, as with most Districts, the court also automatically issues a scheduling order, and requires that order to be served along with the summons and complaint. See, e.g., attached Form BTXN 090 (Form Scheduling Order). After properly serving these documents upon the defendant, plaintiff must file a certificate/proof of service. See Rule 7004(a) and Rule 4(l)(1).

IV. What do you do in response to a complaint?

First things first, do you represent the Defendant on this matter? Due to the cost of defense, debtor counsel typically will carve out adversary proceedings from their engagements with their clients. Debtor counsel should be clear to state this in writing within their form engagement letters and orally explain the issue, risk, and cost to their client pre‐filing.

A. When must you act?

A response or answer is due within 30 days of the ISSUANCE of the summons (i.e., no relation to receipt of the summons). Rule 7012(a).

Due process? Assume answer filed and summons issued Friday, August 16. Answer due 30 days later on Monday, September 16. Plaintiff has until Friday, August 30 to put it in the mail. If after hours, misses Friday mail pickup, weekend comes, Sep 2 is Labor Day, mail doesn’t get picked up until Tuesday, September 3. Potential mail delivery 2 days later on Thursday, September 5, leaving 8 business days to answer – a far cry from 30 days! This actually used to be slightly better before the switch to weekly time keeping. Plaintiffs previously had 10 days, not 14, to serve defendants. The weekly switch did not affect dates more than 28 days out, so the 30 days stayed the same!

Before you answer and waive certain dismissal rights, consider whether the complaint or process/service were defective. Rule 12 requires that certain defenses be made by motion prior to the filing of a responsive pleading, or else be waived. Rule 12(b).


B. Does the court have subject matter jurisdiction?

In the context of discharge objections, a bankruptcy court certainly has jurisdiction; however, in other contexts, it may not. See Frazin v. Haynes & Boone, L.L.P., et al. (In re Frazin), ‐‐‐ F.3d ‐‐‐‐, 2013 WL 5495920 (5th Cir. Oct. 1, 2013). Rule 12(b)(1) allows a defendant to bring a motion to dismiss a complaint for lack of subject matter jurisdiction. In re Wynne, 422 B.R. 763, 766‐7 (Bankr. M.D. Fla. 2010), citing In re Aegis Mortgage Corporation, 2008 WL 2150120 *3 (Bankr. D. Del. 2008). Once subject matter jurisdiction has been challenged pursuant to this Rule, the plaintiff has the burden of showing subject matter jurisdiction exists by a preponderance of the evidence. In re Wynne, 422 B.R. at 767. A plaintiff's allegations regarding subject matter jurisdiction are not presumed to be truthful, and the Court must evaluate the merits of the jurisdictional claims on its own. Id. Rule 12(h)(3) provides that the court must dismiss an action if at any time the court determines that it lacks subject‐matter jurisdiction. In Re Joseph Francis Swain, 437 B.R. 549, 553 (Bankr. E.D. Mich. 2010).

C. Does the complaint contain sufficient facts?

Rule 8 requires merely “a short and plain statement of the claim showing the pleader is entitled to relief”, but courts have read this to require more than one might initially think. See, Rule 12(b)(6) (allowing motion for dismissal for failure to state a claim for which relief may be granted).

Dismissal of this Complaint is warranted as Plaintiff has not pled “enough facts to state a claim for relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1960, 550 U.S. 544, 570 (2007). “Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact).” Id. at 1965 (internal citations omitted). Mere recitals of the elements of a cause of action, supported by conclusory statements and naked assertions devoid of substantiated factual enhancement are insufficient to sustain a statement of a claim. Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009) (citing Twombly, 550 U.S. 544). Additionally, to the extent that a plaintiff's claims set forth conclusory allegations or unwarranted deductions of fact, the Court is not obliged to accept such allegations or deductions as true. Official Comm. of Unsecured Creditors of VarTec Telecom, Inc. v. Rural Tel. Fin. Coop. (In re VarTec Telecom, Inc.), 335 B.R. 631 (Bankr. N.D. Tex. 2005).

D. Does the complaint contain sufficient fraud facts?

If a plaintiff has pled claims based upon alleged fraud, the plaintiff’s burden is even higher under Federal Rule 9(b), which requires the plaintiff to plead the specific time, place, and contents of the alleged false representation, as well as the identity or capacity of the person making the misrepresentation and what that person obtained from making the alleged misrepresentation. See, e.g., Sullivan v. Leor Energy, LLC, 600 F.3d 542, 550 (5th Cir. 2010) (citing ABC Arbitrage v. Tchuruk, 291 F.3d 336, 350 (5th Cir. 2002)); Williams v. WMX Techs., Inc., 112 F.3d 175, 177 (5th Cir. 1997), cert. denied, 522 U.S. 966 (1997); Tuchman v. DSC Communications Corp., 14 F.3d 1061, 1068 (5th Cir. 1994) (quoting Tel‐Phonic Services, Inc. v.


TBS Int’l, Inc., 975 F.2d 1134, 1139 (5th Cir. 1992)). Courts require that the plaintiff properly plead the “who, what, when, where, and how” of the alleged false representations. Milkie v. Extreme Networks, Inc., 2004 WL 690844, slip op. at *7 (N.D. Tex. Mar. 30, 2004). The plaintiff’s failure to do so in his pleadings necessitates that the Motion be granted. “The heightened pleading requirement for fraud applies to claims of misrepresentation, as well as those labeled ‘fraud.’” Blacksmith Inv., LLC v. Cives Steel Co., Inc., 228 F.R.D. 66, 73 (D. Mass. 2005) (citing Powers v. Boston Cooper Corp., 926 F.2d 109, 111 (1st Cir. 1991).

E. Does the complaint contain too many facts?

Rule 15, which applies in adversary proceedings per Bankruptcy Rule 7015, evinces a bias in favor of granting leave for the amendment of a complaint, but it is not automatic. Rule15(a) provides, among other things, that an amendment relates back to the date of the original pleading when “the amendment asserts a claim . . . that arose out of the conduct, transaction, or occurrence set out‐or attempted to be set out‐in the original pleading.” In other words, amendments may relate back if the amendment involves a claim that arose out of the same conduct or transaction addressed in the original pleading.

A single alleged misrepresentation may not give rise to allegations of other unrelated misrepresentations made at different times. For example, a bankruptcy court has refused to grant leave when the plaintiff's original complaint discussed a plaintiff’s 2007 home refinancing transaction, and the proposed amended complaint alluded to several other incidents that took place in other years, including a 2004 refinancing of the plaintiff's homestead and the plaintiff's 2005 redirection of a real estate commission. In re Riggert, 399 B.R. 453, 459 (Bankr. N.D. Tex. 2009). As a distinction, another bankruptcy court recently allowed a plaintiff to amend his complaint to add fraud claims on the basis that “[plaintiff’s] statement in the original complaint that [defendant] borrowed on the policy without permission indicates more than a simple failure to repay; it suggests foul play on the part of [defendant].” Baker v. Carter, 4:12‐CV‐478, 2013 WL 1196106 (E.D. Tex. Mar. 22, 2013).

While it is important to heed the foregoing, it must also be balanced with the famous Twombly–Iqbal standard, which requires a level of factual specificity to be deemed “plausible.” Of course, factual specificity goes exactly against the previously discussed relation‐back doctrine. “Nevertheless, the plaintiff's complaint must be stated with enough clarity to enable a court or an opposing party to determine whether a claim is sufficiently alleged.” Baker v. Carter, 4:12‐CV‐478, 2013 WL 1196106, *5 (E.D. Tex. Mar. 22, 2013) (internal citations omitted). “The factual allegations must be enough to raise a right to relief above the speculative level.” Id.

Counsel must find a balance between specificity and inclusiveness in the complaint. Having as many facts as possible, before pleading, is a start. Counsel can utilize 341 meetings, informal requests, witness interviews, and even Rule 2004 examinations to collect information prior to pleading within the applicable limitations periods.


F. Are there other defects?

Does the court have personal jurisdiction? Rule 12(b)(2). Is the court a proper venue? Rule 12(b)(3). Was there insufficient process or insufficient service of process? Rule 12(b)(4)‐(5). Is a necessary party not joined? Rule 12(b)(7).

G. Plaintiff, is Defendant’s Answer Adequate?

Too often, plaintiffs accept defendants’ answers by simply checking that box and moving on to discovery. Instead, plaintiffs first should consider whether the answer was adequate or defective. Rules of pleading apply equally to answers as they do complaints. This is true not only with respect to the sentence‐by‐sentence admission or denial of allegations, but also as to the affirmative defenses.

Defendants bear the burden of proving their affirmative defenses. See, e.g., Ducre v. Mine Safety Appliances, 963 F.2d 757, 760 (5th Cir. 1992). Though generally disfavored, a decision whether to grant a motion to strike is within the discretion of the court. Jacobs v. Tapscott, 2004 WL 2921806, *2 (N.D. Tex. Dec. 16, 2004) (citing FDIC v. Niblo, 821 F. Supp. 441, 449 (N.D. Tex. 1993)). A court may strike an affirmative defense that is insufficient on its face. Heller Fin., Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1294 (7th Cir. 1989).

Courts in the Fifth Circuit largely apply the “fair notice” pleading standard for affirmative defenses set forth in Woodfield v. Bowman, 193 F.3d 354 (5th Cir.1999).1 The Fifth Circuit requires that affirmative defenses plead “enough specificity or factual particularity to give the plaintiff ‘fair notice’ of the defense that is being advanced”. Woodfield v. Bowman, 193 F.3d 354, 362 (5th Cir.1999). “This requires that the party asserting the affirmative defense allege sufficient facts to give the opposing party fair notice of the nature of the affirmative defense and prevent unfair surprise.” Mary Kay, Inc. v. Dunlap, 2012 WL 2358082 (N.D. Tex. June 21, 2012) (citing SEC v. Cuban, 798 F. Supp. 2d 783, 795 n. 1 (N.D. Tex. 2011)).

Although the court in Woodfield noted that in some instances merely pleading the name of the affirmative defense may be sufficient, a “fact‐specific inquiry” is required to determine whether the pleadings set forth the “minimum particulars” needed to ensure the plaintiff is not the victim of unfair surprise. Mary Kay, 2012 WL 2358082 (citing Woodfield, 193 F.3d at 362); see also E.E.O.C. v. Courtesy Bldg. Services, Inc., 2011 WL 208408 (N.D. Tex. Jan. 21, 2011) (striking barebone assertions of waiver and estoppel) (citing Woodfield, 193 F.3d at 362; Software Publrs. Ass'n v. Scott & Scott, LLP, 2007 WL 2325585, at *2 (N.D.Tex. Aug.15, 2007); TracFone Wireless, Inc. v. King Trading, Inc., 2008 WL 4826035, at *1–2 (N.D.Tex. Nov.6, 2008));

1 The Southern District of Texas has ruled that Twombly (Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555–56 (2007)) and Iqbal (Ashcroft v. Iqbal, 556 U.S. 662, 677–79 (2009)) must be complied with when pleading affirmative defenses. See, e.g., Vargas v. HWC General Maintenance, LLC, 2012 WL 948892, at *1 ‐3 (S.D. Tex. Mar. 20, 2012); U.S. v. Brink, 2011 WL 835828, at *2 ‐3 (S.D. Tex. Mar. 4, 2011). However, the Northern District of Texas has recently held that the pleading standards set forth in Twombly and Iqbal do not apply to affirmative defenses. Mary Kay, Inc. v. Dunlap, 2012 WL 2358082 (N.D. Tex. June 21, 2012) (citing SEC v. Cuban, 798 F. Supp. 2d 783, 795 n. 1 (N.D. Tex. 2011)).


and Mary Kay, Inc. v. Dunlap, 2012 WL 2358082 (N.D. Tex. June 21, 2012) (striking the affirmative defenses of estoppel, ratification, and waiver) (also citing See Software Publrs. Ass'n v. Scott & Scott, LLP, 2007 WL 2325585, at *2 (N.D.Tex. Aug.15, 2007) (striking affirmative defenses of waiver, estoppel, ratification, laches, and unclean hands where mere naming did not provide plaintiff fair notice of defenses being advanced)); see also GE Capital Commercial, Inc. v. Worthington Nat. Bank, 2011 WL 5025153 (N.D. Tex. Oct. 20, 2011) (The “party that asserts an injured party's failure to mitigate his damages has the burden of proving the failure to mitigate and must show the extent to which the damages were increased by the failure to mitigate…. The Defendant “failed to allege in its pleadings . . . how [the Plaintiff] could have acted reasonably to reduce damages” and thus such affirmative defense should be stricken.”).

V. Pretrial matters

A. Initial pretrial conferences

Counsel should not wait too long before conducting their 26(f) conference. Rule 26(f)(1). During this conference (which should be done by phone), counsel will discuss potential for settlement, but, more practically, extent and timing of discovery issues (e.g., whether interrogatories should be increased, depositions limited, potential for non‐local witnesses, etc.). This information will be used for the parties’ proposed scheduling order.

Our Districts handle Rule 16 pretrial scheduling orders differently. For example, in the EBTX, the Court often sets a scheduling conference that details when the 26(f) must be had and when the parties, via lead counsel, shall report in person to the Court at the scheduling conference. See, e.g., attached Form BTXE Scheduling Order. Thereafter, the Court will enter a scheduling order. In the NBTX, the Court automatically enters a scheduling order, but still allows the parties to submit an alternative order if appropriate (and timely!). See, attached Form BTXN 090 (Form Scheduling Order).

B. Initial Disclosures

Rule 26(a)(1) disclosures are important for both sides. They should be used not only to advise your opponent of persons and documents that may be used at trial, but also for purposes of thinking through your case, key testimony and evidence issues, and preparing for discovery. Counsel should ensure their parties take an active role in preparing the disclosures and that their client make a “reasonable inquiry” in preparing and serving their disclosures. See, e.g., Sender v. Mann, 225 F.R.D. 645, 652‐53 (D. Colo. 2005). Disclosures should be “complete and detailed,” and should “give the opposing party information as to the identification and location of persons with knowledge so that they can be contacted in connection with the litigation.” Id. at 650‐53.

C. Post‐Disclosure Discovery

The 7000 series applies in all adversary proceedings. Rule 7001. Whereas Rule 7030 oral depositions can be costly, Rule 7031 written depositions can be useful for reducing fees and costs, and often are used for non‐key and/or non‐party witnesses.


i. Due‐Process Concerns

If the potential deponent (written or oral deposition) is confined, counsel must comply with Rule 30(a)(2) and Rule 31(a)(2) by obtaining leave of court. In service of process, counsel must heed the institution’s rules for procedures. Generally, a staff member will effectuate service of process upon inmates on counsel’s behalf.

ii. Subpoena Powers

Counsel, in serving a non‐local person, must heed Rule 45(a)(2), which governs the court’s territorial limits to issue a subpoena. On this basis, it is sometimes preferable to instead use interrogatories. Rule 33 on interrogatories do not have a leave‐of‐court requirement under Rule 45. On the other hand, Rule 31 on depositions on written questions can only be enforced by Rule 45, which is subject to the court’s territorial limits.

iii. Discovery Cutoff

Counsel, in sending interrogatories, requests for production, or requests for admissions, should pay special attention to the discovery cutoff date, which usually is found in the court’s scheduling order. More specifically, counsel should keep in mind the Rules require that discovery be responded to within 30 days after service. Intuitively this seems straightforward, but it has its own nuances: discovery must be completed (i.e., responses due) before the discovery cutoff. Therefore, discovery must be served well in advance of the cutoff date. If, for example, counsel is mailing the discovery, counsel must mail it at least 33 days (adding three days for postal service per Rule 9006) prior to the discovery cutoff. Factoring holidays or weekends toward the due date may require additional time to meet the deadline.

iv. Discovery Practices

Upon receipt of a discovery request, counsel should thoroughly emphasize to the client the importance of full discovery. To err on the side of caution, counsel should consider instructing the client to give counsel all requested documents regardless of the substance or material; thereafter, counsel can review and filter documents for privilege and scope.

Counsel should always prepare detailed privilege logs. The privilege logs should be detailed enough to convince the other party that the request is indeed privileged by giving dates, names of senders/recipients, copied persons and titles/positions, and subject matter of the document/communication. This contributes to a more efficient discovery process for all parties.

When document production is voluminous, documents produced per responses to requests for production should be bates labeled. This will prevent subsequent disputes to whether a party made full disclosure, and will practically benefit counsel at depositions and the court at evidentiary hearings. It also is a good idea to reference the bates numbers of the produced documents in the cover letter (in addition to the discovery response).


v. Dispositive Motions

Dispositive motions, such as motions for full or partial summary judgment, are a useful tool to reduce costs. Scheduling orders include strict deadlines regarding the filing of dispositive motions, and counsel must strictly comply with such deadlines.

In an effort to reduce expenses of the court system and all parties and counsel, courts take dispositive motions very seriously. When your opposing counsel files such a brief, you should be poised and prepared to respond with strong briefing and supporting affidavits and exhibits. Waiting too long to take discovery may put you in a difficult position to respond. Thus, a strong MSJ filed in a timely manner can pose a very legitimate risk on opposing counsel that may have delayed in preparing the case in hopes of a settlement or far‐off trial.

VI. Trial

Pretrial procedures and orders are generally governed by the court’s local rules. For example, EBTX requires that a pretrial conference be scheduled on written motion to the court or on the court’s own motion. Additionally, it must be no later than twenty‐eight days prior to trial. Local rules also govern trial exhibits, proposed findings of facts and conclusions of law, continuances, briefs, and pretrial orders. Most local rules are very specific. For example, a pretrial order, which must be filed fourteen days prior to trial, requires that its caption include the trial date and the estimated time needed for trial. Failure to comply with pretrial local rules can result in sanctions or other penalties, such as a refusal to admit improperly labeled trial exhibits, or worse.

Following the steps above in pre‐suit investigation and post‐suit discovery will put you in position to win at trial. If nothing else, timely preparation of your evidence pre‐suit, in preparing your complaint, and post‐suit in framing a potential MSJ, can provide invaluable structure to your case and save significant costs at trial. The following section will discuss what to do after your trial has concluded and an appeal is considered or filed.

VII. Additional Take‐Aways

Prepare a thorough, detailed roadmap prior to filing suit. Utilize 341 meetings, informal requests, witness interviews, and even Rule 2004 examinations to collect information prior to pleading within the applicable limitations periods.

Consider all options for response beyond a mere answer. Be sure you plead in good faith and consider the additional costs for your client from additional work.

Discuss with your client the available options for discovery and trial preparation. For example, a cost‐conscious client is more likely to prefer interrogatories or a deposition on written questions as opposed to an oral deposition. There are positives and negatives for each.


Calendar advance notices of important deadlines like discovery cutoffs and dispositive‐pleading deadlines. Send final discovery 40 days before the cutoff to ensure proper time for response. Prepare dispositive motions early so as not to rush the matter or lose the benefit of saving lengthy litigation costs.

APPENDIX I

ADVERSARY PROCEEDINGS: NUTS AND BOLTS

Description of Document No. of Pages

Form B104 2

Form B250 2

Form BTXN090 (BTXN Scheduling Order) 2

EBTX Scheduling Order 2

B104 (FORM 104) (08/07)

ADVERSARY PROCEEDING COVER SHEET (Instructions on Reverse)

ADVERSARY PROCEEDING NUMBER (Court Use Only)

PLAINTIFFS DEFENDANTS

ATTORNEYS (Firm Name, Address, and Telephone No.)

ATTORNEYS (If Known)

PARTY (Check One Box Only) □ Debtor □ U.S. Trustee/Bankruptcy Admin □ Creditor □ Other □ Trustee

PARTY (Check One Box Only) □ Debtor □ U.S. Trustee/Bankruptcy Admin □ Creditor □ Other □ Trustee

CAUSE OF ACTION (WRITE A BRIEF STATEMENT OF CAUSE OF ACTION, INCLUDING ALL U.S. STATUTES INVOLVED)

NATURE OF SUIT (Number up to five (5) boxes starting with lead cause of action as 1, first alternative cause as 2, second alternative cause as 3, etc.)

FRBP 7001(1) – Recovery of Money/Property □ 11-Recovery of money/property - §542 turnover of property □ 12-Recovery of money/property - §547 preference □ 13-Recovery of money/property - §548 fraudulent transfer □ 14-Recovery of money/property - other FRBP 7001(2) – Validity, Priority or Extent of Lien □ 21-Validity, priority or extent of lien or other interest in property FRBP 7001(3) – Approval of Sale of Property □ 31-Approval of sale of property of estate and of a co-owner - §363(h) FRBP 7001(4) – Objection/Revocation of Discharge □ 41-Objection / revocation of discharge - §727(c),(d),(e) FRBP 7001(5) – Revocation of Confirmation □ 51-Revocation of confirmation FRBP 7001(6) – Dischargeability □ 66-Dischargeability - §523(a)(1),(14),(14A) priority tax claims □ 62-Dischargeability - §523(a)(2), false pretenses, false representation, actual fraud □ 67-Dischargeability - §523(a)(4), fraud as fiduciary, embezzlement, larceny

(continued next column)

FRBP 7001(6) – Dischargeability (continued) □ 61-Dischargeability - §523(a)(5), domestic support □ 68-Dischargeability - §523(a)(6), willful and malicious injury □ 63-Dischargeability - §523(a)(8), student loan □ 64-Dischargeability - §523(a)(15), divorce or separation obligation (other than domestic support) □ 65-Dischargeability - other

FRBP 7001(7) – Injunctive Relief □ 71-Injunctive relief – imposition of stay □ 72-Injunctive relief – other FRBP 7001(8) Subordination of Claim or Interest □ 81-Subordination of claim or interest FRBP 7001(9) Declaratory Judgment □ 91-Declaratory judgment FRBP 7001(10) Determination of Removed Action □ 01-Determination of removed claim or cause Other □ SS-SIPA Case – 15 U.S.C. §§78aaa et.seq. □ 02-Other (e.g. other actions that would have been brought in state court

if unrelated to bankruptcy case)

□ Check if this case involves a substantive issue of state law □ Check if this is asserted to be a class action under FRCP 23 □ Check if a jury trial is demanded in complaint Demand $ Other Relief Sought

B104 (FORM 104) (08/07), Page 2

BANKRUPTCY CASE IN WHICH THIS ADVERSARY PROCEEDING ARISES NAME OF DEBTOR BANKRUPTCY CASE NO.

DISTRICT IN WHICH CASE IS PENDING DIVISION OFFICE NAME OF JUDGE

RELATED ADVERSARY PROCEEDING (IF ANY) PLAINTIFF DEFENDANT ADVERSARY

PROCEEDING NO.

DISTRICT IN WHICH ADVERSARY IS PENDING DIVISION OFFICE NAME OF JUDGE

SIGNATURE OF ATTORNEY (OR PLAINTIFF)

DATE PRINT NAME OF ATTORNEY (OR PLAINTIFF)

INSTRUCTIONS

The filing of a bankruptcy case creates an "estate" under the jurisdiction of the bankruptcy court which consists of all of the property of the debtor, wherever that property is located. Because the bankruptcy estate is so extensive and the jurisdiction of the court so broad, there may be lawsuits over the property or property rights of the estate. There also may be lawsuits concerning the debtor’s discharge. If such a lawsuit is filed in a bankruptcy court, it is called an adversary proceeding.

A party filing an adversary proceeding must also must complete and file Form 104, the Adversary Proceeding Cover

Sheet, unless the party files the adversary proceeding electronically through the court’s Case Management/Electronic Case Filing system (CM/ECF). (CM/ECF captures the information on Form 104 as part of the filing process.) When completed, the cover sheet summarizes basic information on the adversary proceeding. The clerk of court needs the information to process the adversary proceeding and prepare required statistical reports on court activity.

The cover sheet and the information contained on it do not replace or supplement the filing and service of pleadings

or other papers as required by law, the Bankruptcy Rules, or the local rules of court. The cover sheet, which is largely self-explanatory, must be completed by the plaintiff’s attorney (or by the plaintiff if the plaintiff is not represented by an attorney). A separate cover sheet must be submitted to the clerk for each complaint filed. Plaintiffs and Defendants. Give the names of the plaintiffs and defendants exactly as they appear on the complaint. Attorneys. Give the names and addresses of the attorneys, if known. Party. Check the most appropriate box in the first column for the plaintiffs and the second column for the defendants. Demand. Enter the dollar amount being demanded in the complaint. Signature. This cover sheet must be signed by the attorney of record in the box on the second page of the form. If the plaintiff is represented by a law firm, a member of the firm must sign. If the plaintiff is pro se, that is, not represented by an attorney, the plaintiff must sign.

Form B 250A (12/09)

United States Bankruptcy Court_______________ District Of _______________

In re , ) Case No. Debtor )

) Chapter )

)Plaintiff )

)v. ) Adv. Proc. No.

) )

Defendant )

SUMMONS IN AN ADVERSARY PROCEEDING

YOU ARE SUMMONED and required to file a motion or answer to the complaint which is attached tothis summons with the clerk of the bankruptcy court within 30 days after the date of issuance of thissummons, except that the United States and its offices and agencies shall file a motion or answer to thecomplaint within 35 days.

Address of the clerk:

At the same time, you must also serve a copy of the motion or answer upon the plaintiff's attorney.

Name and Address of Plaintiff's Attorney:

If you make a motion, your time to answer is governed by Fed. R. Bankr. P. 7012.

IF YOU FAIL TO RESPOND TO THIS SUMMONS, YOUR FAILURE WILL BE DEEMEDTO BE YOUR CONSENT TO ENTRY OF A JUDGMENT BY THE BANKRUPTCY COURTAND JUDGMENT BY DEFAULT MAY BE TAKEN AGAINST YOU FOR THE RELIEFDEMANDED IN THE COMPLAINT.

(Clerk of the Bankruptcy Court)

Date: By: (Deputy Clerk)

CERTIFICATE OF SERVICE

I, (name), certify that service of this summons and a copy ofthe complaint was made (date) by:

Q Mail service: Regular, first class United States mail, postage fully pre-paid, addressedto:

Q Personal Service: By leaving the process with the defendant or with an officer or agentof defendant at:

Q Residence Service: By leaving the process with the following adult at:

Q Certified Mail Service on an Insured Depository Institution: By sending the process bycertified mail addressed to the following officer of the defendant at:

Q Publication: The defendant was served as follows: [Describe briefly]

Q State Law: The defendant was served pursuant to the laws of the State of , asfollows: [Describe briefly]

If service was made by personal service, by residence service, or pursuant to state law, I furthercertify that I am, and at all times during the service of process was, not less than 18 years of age andnot a party to the matter concerning which service of process was made.

Under penalty of perjury, I declare that the foregoing is true and correct.

Date Signature

Print Name :

Business Address:

BTXN 090 (rev. 12/09)

UNITED STATES BANKRUPTCY COURTNORTHERN DISTRICT OF TEXAS

In Re: §§§§§§§§§

Douglas C. Hildinger

Debtor(s) Case No.: 13−30304−bjh7 Chapter No.: 7

Zeba Kamal et al.Plaintiff(s) Adversary No.: 13−03137−bjh

vs.Douglas C. Hildinger

Defendant(s)

ORDER REGARDING ADVERSARY PROCEEDINGS TRIAL SETTING ANDALTERNATIVE SCHEDULING ORDER

An adversary complaint is set for trial routinely at the time of its filing. Special settings or pretrial conferencesmay be scheduled by contacting the appropriate Courtroom Deputy.

TRIAL is set before the Honorable Barbara J. Houser at 1100 Commerce St., 14th Floor Courtroom,Dallas, Texas 75242 the week of November 11, 2013. Docket call for this trial will be held on November 5, 2013 at1:15 p.m. at 1100 Commerce St., 14th Floor Courtroom, Dallas, Texas 75242. A pretrial conference shall bescheduled by the parties at least seven (7) calendar days prior to trial docket call in a complex adversary proceeding ifthe parties anticipate that trial will exceed one day or if there are preliminary matters that should be addressed by theCourt prior to the commencement of trial.

PART I: INSTRUCTIONS

1. Plaintiff is responsible for ensuring that proper service is provided to each defendant. The Clerk shall issue one original summons, whichshall be conformed by the plaintiff for service on multiple defendants. Federal Bankruptcy Rule 7004(e) requires you to serve the fullycompleted SUMMONS form and a copy of the COMPLAINT on each defendant within fourteen (14) days of issuance. In addition, theCourt also directs that this ORDER be served with the SUMMONS and COMPLAINT.

2. Plaintiff shall file a RETURN on the SUMMONS with a CERTIFICATE OF SERVICE that provides the nameand address of each party served and the manner of service.

3. If a trial setting is passed for settlement at trial docket call and no written request is filed to retain the case on theCourt's docket, an automatic Dismissal Without Prejudice shall be entered on or after four (4) weeks. The Court'sTrial Calendar is available on the court's web site at www.txnb.uscourts.gov.

PART II: GENERAL PROVISIONS GOVERNING DISCOVERY

1. Unless otherwise ordered by the Court, the disclosures required by Federal Bankruptcy Rule 7026(a) shall be made within fourteen (14)days of the entry of a scheduling order, including the Alternative Scheduling Order contained in Part III below (which shall become effectiveon the forty−sixth day following the entry of this Order.

2. Unless the parties agree or the Court orders otherwise, Federal Bankruptcy Rule 7026(f) requires that parties shallconfer to consider the nature and basis of their claims and defenses and the possibilities for a prompt settlement orresolution of the case, to make or arrange for the disclosures required by Federal Bankruptcy Rule 7026(a)(1), todevelop a proposed discovery plan, and to submit a proposed scheduling order. The parties shall confer with eachother regarding these matters within thirty (30) days of the service of the Summons unless the Court orders otherwise.

3. During such conference, the parties may agree to waive the requirement of submitting their own proposedscheduling order and may follow the terms and deadlines contained in the Alternative Scheduling Order set forth inPart III below (the "Alternative Scheduling Order"). If the parties do not submit a proposed scheduling order or donot schedule a status conference with the Court to discuss the provisions and deadlines of a scheduling order withinforty−five days of the filing of this adversary proceeding, then the parties are deemed to have consented to the termsof the Alternative Scheduling Order.

PART III: ALTERNATIVE SCHEDULING ORDER

The Court directs compliance with the following schedule:

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1. Discovery must be completed forty−five (45) days prior to Docket Call. The names and addresses of experts mustbe exchanged sixty (60) days prior to Docket Call.

2. A Joint Pretrial Order in compliance with Local District Court Rule 16.4 shall be filed, served, and uploaded forCourt entry seven (7) days prior to Docket Call. All counsel (or a pro se party) are responsible for preparing the JointPretrial Order, which shall contain the following: (a) a summary of the claims and defenses of each party; (b) astatement of stipulated facts; (c) a list of the contested issues of fact; (d) a list of contested issues of law; (e) anestimate of the length of trial; (f) a list of additional matters which would aid in the disposition of the case; and (g) thesignature of each attorney (or pro se party).

3. Each exhibit shall be marked with an exhibit label. Except for impeachment documents, all exhibits, along with a list of witnesses to becalled, shall be exchanged with opposing counsel (or pro se party) fourteen (14) days prior to Docket Call. Each party shall also file a list ofexhibits and witnesses fourteen (14) days prior to Docket Call. All exhibits not objected to in writing by Docket Call shall be admitted intoevidence at trial without further proof, except for objections to relevance. Written objections to exhibits will be taken up either at thebeginning or during the course of the actual trial or at any pretrial conference.

4. Written Proposed Findings of Fact and Conclusions of Law shall be filed seven (7) days prior to Docket Call. Trialbriefs shall be filed addressing contested issues of law seven (7) days prior to Docket Call.

5. Unless otherwise directed by the Presiding Judge, all dispositive motions must be heard no later than fourteen (14) days prior to DocketCall. Accordingly, all dispositive motions must be filed no later than forty−five (45) days prior to Docket Call, unless the Court modifies thisdeadline.

6. All parties and counsel must certify to full compliance with this Order at Docket Call. If a resetting is allowed bythe Court, the plaintiff or plaintiff's attorney shall notify all other parties and shall file with the Clerk a certificate ofservice indicating the manner, date, and to whom notice was given.

7. If the case is reset, all the deadlines in Part III nos. 1 through 5 will be shifted to the newly scheduled Docket Calldate in the absence of a contrary Court order.

8. Sanctions may be imposed for failure to comply with this Order.

DATED: 6/18/13 FOR THE COURT:Tawana C. Marshall, Clerk of Court

by: /s/Nicole Whittington, Deputy Clerk

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UNITED STATES BANKRUPTCY COURTFOR THE EASTERN DISTRICT OF TEXAS

SHERMAN DIVISION

IN RE:Mig Financial Group II, LLC 1001 Cross Timbers, Suite 2130 Flower Mound, TX 75028 TIN: 20-5288451 Debtor

Case No. 12-40250 btr Chapter: 7

Mark A. Weisbart Plaintiff

vs.

Kimberly Migliaccio Defendant

Mig Financial Group, Inc. Defendant

Vincent Migliaccio Defendant

Adversary No. 12-04140 btr

NOTICE AND ORDER REGARDING INITIAL PRE-TRIAL PROCEDURESIN ADVERSARY PROCEEDING AND SCHEDULING A TELEPHONIC

MANAGEMENT CONFERENCE

TO: ALL ATTORNEYS OF RECORD AND ALL UNREPRESENTED PARTIES

Pursuant to Federal Rule of Bankruptcy Procedure 701(a), it is hereby by the Court that:ORDERED

The parties to this adversary proceeding shall conduct the conference required under Fed R.Bankr. P. 7026(f) no later than prior to the date of the Management Conference14 calendar daysestablished by this Order in order to consider the nature and basis of their respective claims anddefenses, the possibilities for a prompt settlement or resolution of the case, to make or arrange for theinitial disclosures required under Fed. R. Bankr. P. 7026(a)(1), and to develop a proposed discoveryplan for this adversary proceeding.

A party may not seek discovery from any source prior to the time that the Rule 7026(f)conference among the parties is conducted.

The proposed discovery plan shall be presented orally to the Court at the ManagementConference established by this Order and the parties are hereby excused from submitting a writtenreport regarding their proposed discovery plan.

EOD 12/20/2012

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The parties shall make their initial disclosures required under Fed. R. Bankr. P. 7026(a)(1) nolater than prior to the date of the Management Conference established by the Order.7 calendar daysEach party should file with the Court a "Notice of Initial Disclosure," without accompanyingdocumentation, at the time that the initial disclosures are made by that party. Any party that withoutsubstantial justification fails to make its initial disclosures shall be subject to that sanctions set forth inFed. R. Bankr. P. 7037(c)(1).

The Telephonic Management Conference Hearing in this adversary proceeding will beconducted telephonically on Thursday, March 7, 2013 at 9:30 am. Parties are instructed toappear telephonically using the following call in information: Dial-in information: 1.888.675.2535, Access code: 4225607; and when prompted the SecurityCode for this hearing is: 1799. The parties may place the call on a speaker phone, and ifNOTthe party is using a mobile phone, the party must be in an appropriately quiet location.

The trial attorneys who will actually present the case in Court and any unrepresented partiesare required to attend the Management Conference and be prepared to present their proposeddiscovery plan to the Court and to discuss and make binding agreements concerning the followingmatters:

Any amendments to the pleadings, including addition of parties and to set deadlinestherefore;

Anticipated discovery and deadlines and limitations pertaining thereto;Anticipated pre-trial motions (if any) and deadlines for filing same;Necessity for further pre-trial conferences; andAny other matter bearing on preparation of the adversary processed for trial.

The Court views the scheduled Management Conference and the pre-trial proceduresestablished by this Order and the Federal Rules of Bankruptcy Procedure as important steps in thepre-trial process. Any failure to comply with the terms of this Order or the requirements of theFederal Rules of Bankruptcy Procedure, or a failure to participate in good faith in the ManagementConference may result in the imposition of sanctions by the Court upon any party or any attorney forany party pursuant to Federal Rules of Bankruptcy Procedure 7016 and 7037, or any other applicableauthority.

HONORABLE BRENDA T. RHOADES,UNITED STATES BANKRUPTCY JUDGE

Signed on12/20/2012

SDHONORABLE BRENDA T. RHOADES, CHIEF UNITED STATES BANKRUPTCY JUDGE

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