No. 21-8

Wilma M. Pennington-Thurman v. Federal Home Loan Mortgage Corporation, et al.

Lower Court: Eighth Circuit
Docketed: 2021-07-07
Status: Denied
Type: Paid
Response WaivedRelisted (2)
Tags: bankruptcy bankruptcy-procedure civil-procedure civil-rights creditor-rights due-process fraud-on-court judicial-ethics preclusion priority-rules standing
Latest Conference: 2022-04-14 (distributed 2 times)
Question Presented (from Petition)

1. A finding of fraud on the court is reserved for material, intentional misrepresentations that could not have been discovered earlier. Do instances discovered in 2021 after settlement of 2010 rise to the level of fraud on the court under Rule 60{dX3), whereas a bankruptcy judge presiding over debtor 's bankruptcy case for eleven years did not recuse himself while he was working closely with an Attorney that is an Attorney with the law firm representing debtor 's creditor during most of that time?

2. Congress did not authorize a "rare case" exception that permits courts to disregard priority in structured dismissals for "sufficient reasons." The fact that it is difficult to give precise content to the concept of "sufficient reasons" threatens to turn the court below 's exception into a more general rule, resulting in uncertainty that has potentially serious consequences —e.g., departure from the protections granted particular classes of creditors, changes in the bargaining power of different classes of creditors even in bankruptcies that do not end in structured dismissals, risks of collusion, and increased difficulty in achieving settlements. Courts cannot deviate from the strictures of the Code, even in "rare cases. " Pp. 16-18. See CZYZEWSKIET AL. v. JEVIC HOLDING CORP. ETAL. 15-649(2017)
The Code makes clear that distributions in a Chapter 7 liquidation must follow this prescribed order. §§725,726. Id

Why were these cases in Federal Court, Eastern District of Missouri treated as an unusual "rare case" justifying deviation from the ordinary priority rules? Same parties, same controversy.

3. The preclusive effect of a state court judgment in a subsequent federal lawsuit generally is determined by the full faith and credit statute, which provides that state judicial proceedings "shall have the same full faith and credit in every court within the United States ... as they have by law or usage in the courts of such State... from which they are taken." (73 S' . This statute directs a federal court to refer to the preclusion law of the State in which judgment was rendered. "It has long been established that § 1738 does not allow federal courts to employ their own rules of res judicata in determining the effect of state judgments. Rather, it goes beyond the common law and commands a federal court to accept the rules chosen by the State from which die judgment is taken. " Kremer v. Chemical Construction Corp., 456 U. S. 461. 481*482 (1982); see also Allen v. McCurry, 449 U. S. 90.96 (1980).
Why would Debtor 's bankruptcy Trustee be in defiant of § 1738, co-author and sign a "Joint Motion to Dismiss " filed in state court, authorizing dismissal with prejudice of adjudicated state court cases placed in the estate of debtor ?

4. In most cases, creditors cannot take action against a debtor 's property until the bankruptcy is closed. See 11 U.S.C. § 554(c). With respect to property of the estate, the stay lasts until the property is no longer part of the bankruptcy estate. See 11 U.S.C. § 362(cXU
Is it a violation of the 14th Amendment Due Process protection for The Bankruptcy Trustee and Bankruptcy Judge to allow the State trial court proceeding to continue in favor of the creditor?

Question Presented (AI Summary)

Question not identified.

Docket Entries

2022-04-18
Rehearing DENIED.
2022-03-23
DISTRIBUTED for Conference of 4/14/2022.
2021-10-29
2021-10-04
Petition DENIED.
2021-08-18
DISTRIBUTED for Conference of 9/27/2021.
2021-08-06
Waiver of right of respondents Federal Home Loan Mortgage Coporation Millsap & Singer, LLC to respond filed.
2021-06-28
Petition for a writ of certiorari filed. (Response due August 6, 2021)

Attorneys

Federal Home Loan Mortgage Coporation Millsap & Singer, LLC
Charles S. Pullium IIIMillsap & Singer, LLC, Respondent
Wilma M. Pennington-Thurman
Wilma Pennington-Thurman — Petitioner