United States Bankruptcy Appellate Panel of the Sixth Circuit
In re: BX Acquisitions, Inc., Debtor.
Toledo-Lucas County Port Authority, Defendant-Appellee. Scott E. Eisenberg, as Trustee of the BX Acquisitions, Inc. Liquidating Trust, Plaintiff-Appellant,
from the United States Bankruptcy Court for the Northern
District of Ohio at Toledo. No. 15-33538; Adv. No.
17-03024-John P. Gustafson, Judge.
Michaels, GOLDSTEIN & MCCLINTOCK LLLP, Chicago, Illinois,
Patricia Fugée, FISHER BROYLES, LLP, Perrysburg, Ohio,
Michael W. Bragg, Jennifer A. McHugh, SPENGLER NATHANSON
P.L.L., Toledo, Ohio, for Appellee.
Before: HARRISON, OPPERMAN, and WISE, Bankruptcy Appellate
F. HARRISON, BANKRUPTCY APPELLATE PANEL JUDGE.
E. Eisenberg, the Liquidating Trustee ("Trustee"),
appeals from the bankruptcy court's decision granting
summary judgment to Toledo-Lucas County Port Authority
("Port Authority"), dismissing the Trustee's
claim to avoid and recover post-petition transfers, and
denying the Trustee's cross-motion for summary judgment.
the Debtor's disputed post-petition payments to the Port
Authority were authorized by agreed Cash Collateral Orders,
and whether the Cash Collateral Orders were binding on the
United States District Court for the Northern District of
Ohio has authorized appeals to the Panel, and no party has
timely elected to have this appeal heard by the district
court. 28 U.S.C. § 158(b)(6), (c)(1). A final order of
the bankruptcy court may be appealed as of right pursuant to
28 U.S.C. § 158(a)(1). For purposes of appeal, a final
order "ends the litigation on the merits and leaves
nothing for the court to do but execute the judgment."
Midland Asphalt Corp. v. United States, 489 U.S.
794, 798 (1989) (citations and internal quotations omitted).
The granting of a motion for summary judgment to one party
and denying it to another is a final order. Rogan v.
Fifth Third Mortg. Co. (In re Rowe), 452 B.R.
591, 593 (B.A.P. 6th Cir. 2011).
the granting of summary judgment is reviewed de
novo. Dymarkowski v. Savage (In re
Hadley), 561 B.R. 384, 388 (B.A.P. 6th Cir. 2016).
"Under a de novo standard of review, the
reviewing court decides an issue independently of, and
without deference to, the trial court's
determination." Matteson v. Bank of Am., N.A.
(In re Matteson), 535 B.R. 156, 159 (B.A.P. 6th Cir.
2015) (citations omitted). In this case, however, the
bankruptcy court's decision was based on an
interpretation of its prior orders, and a review of such is
for clear abuse of discretion. East Coast Miner LLC v.
Nixon Peabody LLP (In re Licking River Mining,
LLC), 911 F.3d 806, 810 (6th Cir. 2018) (citing
Enodis Corp. v. Emp'rs Ins. of Wausau (In re
Consol. Indus. Corp.), 360 F.3d 712, 716 (7th Cir.
Acquisitions, Inc. ("Debtor") was a Delaware
corporation that provided customized logistics solutions to
the transportation and distribution industries. Its principal
place of business was located at One Air Cargo Parkway East,
Swanton, Ohio, an intermodal cargo sort facility
("Facility"), owned and managed by the Port
October 31, 2011, the Debtor entered into a Facilities and
Services Management Agreement ("Management
Agreement") with the Port Authority that outlined the
relationship between the parties as it pertained to the
Debtor's use of the Facility. The Management Agreement
provided that in exchange for the Debtor's use,
management, and maintenance of the Facility, the Debtor would
pay the Port Authority: (1) a periodic fixed annual fee
("Fixed Fee"), due semiannually in 2012 and 2013
and then monthly beginning in 2014; and (2) a
percentage-based fee based on the Debtor's gross annual
revenues. Beginning in 2014, the parties operated under a
Third Amendment to the Management Agreement. The Third
Amendment, finalized in July 2015, provided that instead of
periodic Fixed Fee payments, the Debtor would pay the Port
Authority a Fixed Fee of $500, 000 on or before December 31
of each contract year. Although not signed by the parties,
the Debtor and the Port Authority treated the Third Amendment
as effective and binding until it was later rejected during
the course of the Debtor's bankruptcy.
uncontroverted affidavit of the Port Authority's general
counsel, Dawn M. Wenk, "[u]nder the terms of the Third
Amendment, BX owed the Port Authority a fee of $500, 000.00
by December 31, 2015. BX was entitled to take a credit
against that payment in the amount of $350, 000.00."
[Aff. of Dawn M. Wenk, Esq., at 2, Adv. P. 17-03024 ECF No.
30, Exh. A]. Ms. Wenk also maintained that the Debtor paid
the 2014 Fixed Fee via a single annual payment as required
under the Third Amendment and had not made the 2015 Fixed Fee
payment as of the date of bankruptcy filing. Further, Ms.
Wenk stated in her affidavit that the Debtor communicated
with the Port Authority post-petition regarding the
Debtor's intent to assume the Management Agreement during
the course of its Chapter 11 proceedings and eventually
extend its terms.
November 2, 2015, the Debtor filed a voluntary Chapter 11
petition that included reference to the Port Authority and
the Management Agreement on Schedule G, "Executory
Contracts and Unexpired Leases." On that same day, the
Debtor filed a Motion to Use Cash Collateral with an attached
budget, running from November 1, 2015, through December 31,
2015. The motion did not include any payments intended for
the Port Authority, either in the motion or the attached
budget. The bankruptcy court entered an order shortening the
time for notice to one day. The first cash collateral hearing
was held on November 3, 2015, and the bankruptcy court's
proceeding memo reflected that the parties were "to
circulate and submit an agreed Order." [Proceeding Memo,
Bankr. Case No. 15-33538, ECF No. 13]. The Agreed First
Interim Order for use of cash collateral, adequate
protection, and setting an additional hearing was entered on